On Thursday, D.R. Horton (NYSE:DHI), a leading home construction company with a market capitalization of $44 billion, saw its price target increased by BTIG to $205 from the previous $195, while the firm maintained a Buy rating on the stock. Currently trading at $137.24, near its 52-week low, the stock’s adjustment follows the company’s latest earnings release, which presented sales figures surpassing expectations. According to InvestingPro data, the company maintains a healthy P/E ratio of 9.56.
The company’s performance was noted as "encouraging" despite the presence of some disruptive factors. With revenue growth of 3.78% and a strong financial health score rated as "GOOD" by InvestingPro, the report acknowledged that calendar shifts and weather-related disturbances, specifically hurricanes, had obscured some of the underlying positive sales trends. However, these factors did not significantly dampen the optimistic outlook on the company’s shares.
D.R. Horton’s restaurant brands also showed varying degrees of success in the recent quarter, with LongHorn Steakhouse delivering an exceptional performance and Olive Garden earning praise for its solid results. An observed increase in visitation by lower- and middle-income consumers marked a notable reversal from trends earlier in the year.
BTIG also highlighted the accelerated deployment of Uber Eats delivery services as a positive development for D.R. Horton. The analyst firm has a separate Buy rating on Uber Technologies (NYSE:UBER) with a price target of $90. The firm believes that D.R. Horton’s moderate pricing strategy, compared to quick-service restaurants, is shrinking the value gap, which is likely to contribute to stronger performance in the second half of the fiscal year.
In other recent news, D.R. Horton, a prominent home construction company, has seen a series of developments. The company reported a 12% decrease in earnings per diluted share for Q4 2024, despite a slight increase in net income for the full year, with pre-tax income of $1.7 billion on revenues of $10 billion for the quarter. Home sales revenue stood at $8.9 billion from 23,647 closed homes. However, the average closing price experienced a 1% year-over-year drop.
Simultaneously, D.R. Horton has revised its investment agreement with real estate developer Forestar Group Inc (NYSE:FOR)., raising the capital expenditure threshold for Forestar’s investment decisions from $20 million to $45 million. D.R. Horton currently owns approximately 62% of Forestar’s outstanding common stock.
In terms of analyst perspectives, JPMorgan downgraded D.R. Horton’s shares from Neutral to Underweight, citing overvaluation concerns. Similarly, Raymond (NS:RYMD) James downgraded the company’s shares from Outperform to Market Perform, referring to increased pressures on the entry-level homebuilding market following recent election results.
Looking ahead, D.R. Horton anticipates that the spring selling season will be crucial for its homebuilding volume and profit margins in fiscal 2025. The company also plans to repurchase approximately $2.4 billion in stock and pay $500 million in dividends in the coming fiscal year.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.