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Investing.com - BTIG initiated coverage on D.R. Horton (NYSE:DHI) with a Buy rating and a price target of $186.00 on Monday. The homebuilder, currently trading at $157.42 with a market cap of $46.14 billion, has seen its shares surge 34% over the past six months.
The research firm cited D.R. Horton’s spec production model, deep local market share, broad geographic footprint, and land-light balance sheet as factors that can drive earnings and return on equity outperformance through the housing cycle. InvestingPro data shows the company currently delivers a 14% return on equity while operating with a moderate debt-to-equity ratio of 0.25.
BTIG expects fiscal year 2026 to be another weak year for housing demand overall, but sees opportunities for D.R. Horton to outperform its peers in the challenging environment.
The firm also noted that D.R. Horton is among the homebuilders most positioned to benefit from a potential "Goldilocks upside scenario" in the housing market.
While acknowledging that D.R. Horton’s current price-to-book valuation of 1.9x "is not cheap," BTIG believes relative outperformance and progress toward a higher return on equity can drive multiple expansion in fiscal year 2026, designating the stock as a "BTIG Top Pick."
In other recent news, D.R. Horton reported its fourth-quarter earnings for fiscal year 2025, presenting a mixed financial performance. The homebuilder’s earnings per share (EPS) came in at $3.04, which was below the consensus estimate of $3.27 and Citizens’ expectation of $3.29. This shortfall was mainly due to lower-than-anticipated home deliveries, with the company completing 23,368 homes, slightly missing its guidance range. Despite the earnings miss, D.R. Horton’s revenue exceeded forecasts, reaching $9.68 billion compared to the expected $9.42 billion.
Citizens maintained its Market Outperform rating for D.R. Horton, reiterating a price target of $180.00, despite the earnings miss. The firm’s decision reflects a continued positive outlook for the company. The recent developments highlight the challenges and opportunities facing D.R. Horton, as it navigates market conditions. Investors are paying close attention to these results to assess the company’s future performance.
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