- D R Horton Inc (NYSE:DHI) reported fourth-quarter sales growth of 26.7% year-over-year to $8.11 billion, beating the consensus of $7.94 billion.
- Homebuilding revenue rose 24% Y/Y to $7.6 billion. Homes closed in the quarter increased 8% to 21,937 homes versus 20,248 homes closed last year.
- EPS improved to $3.70 from $2.24 in 4Q20, beating the consensus of $3.40.
- Consolidated pre-tax profit margin improved 480 bps to 21.3%.
- Net sales orders for the quarter decreased 33% Y/Y to 15,949 homes and 17% in value to $6 billion compared to 23,726 homes and $7.3 billion in the same quarter of fiscal 2020.
- D R Horton generated cash from operating activities for the year of $534.4 million, compared to $1.42 billion a year ago.
- D.R. Horton repurchased 2.3 million shares of common stock for $212.6 million. The company’s remaining stock repurchase authorization as of September 30, 2021, was $546.2 million.
- The cancellation rate for the quarter was 19%, unchanged from the prior-year quarter.
- D R Horton had $3 billion of unrestricted homebuilding cash and $2 billion of available capacity on its revolving credit facility for total homebuilding liquidity of $5 billion.
- The company’s Return on equity was 31.6% in fiscal 2021, and homebuilding return on inventory (ROI) of 37.9%.
- At September 30, 2021, the company had 47,800 homes in inventory, of which 21,700 were unsold.
- FY22 Guidance: D.R. Horton expects Consolidated revenues of $32.5 billion – $33.5 billion vs. consensus of $32.22 billion, and Homes closed between 90,000 homes and 92,000 homes.
- Price Action: DHI shares are trading higher by 3.54% at $96 on the last check Tuesday.
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Understanding Value Stocks
A value stock is traditionally defined in terms of how investors in the marketplace are valuing that company's future growth prospects. Low P/E multiples are good base indicators that the company is undervalued and can most likely be labelled as a value stock.
