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Investing.com - BofA Securities has raised its price target on D.R. Horton (NYSE:DHI) to $155.00 from $135.00 while maintaining a Neutral rating on the homebuilder’s stock.
The price target adjustment follows D.R. Horton’s fiscal third-quarter 2025 earnings report, which showed earnings per share of $3.36, exceeding both BofA’s forecast of $2.96 and the consensus estimate of $2.90.
D.R. Horton shares jumped 17% following the earnings announcement, marking the stock’s largest single-day increase in over 15 years. The gain significantly outperformed both the flat S&P 500 and the S&P homebuilding index, which rose 10%.
BofA Securities attributed the earnings beat to stronger deliveries and improved margins, noting that D.R. Horton’s outlook for revenue and gross margin was better than expected. The firm raised its fiscal 2025 and 2026 EPS estimates by 8% and 1%, respectively.
The homebuilder now trades at approximately 1.8 times forward price-to-book value with an estimated fiscal 2026 return-on-equity of 15%, compared to the average builder at 1.6 times price-to-forward book with a 17% ROE. Current metrics from InvestingPro show a P/E ratio of 40.8x and an EV/EBITDA of 9.9x, suggesting the stock is currently overvalued based on InvestingPro’s Fair Value analysis.
In other recent news, DiamondRock Hospitality Company reported its first-quarter 2025 earnings, meeting earnings per share (EPS) forecasts with a reported EPS of $0.04. However, the company’s revenue of $251.8 million fell short of the expected $258.42 million. Additionally, DiamondRock Hospitality announced the successful refinancing and upsizing of its senior unsecured credit facility to $1.5 billion, which includes a $400 million revolving credit facility and several term loans. In related developments, Citi analysts have updated their financial model for DiamondRock Hospitality, lowering the price target to $8 from the previous $9, while maintaining a Neutral rating. The analysts noted a slight increase in the full-year 2025 estimated operating funds from operations (FFO) to $1.00. Meanwhile, Texas Capital Securities initiated coverage on D.R. Horton with a Hold rating and a price target of $130.00. This coverage highlights D.R. Horton’s status as a leading national homebuilder with a diverse market presence. These updates provide investors with key insights into the financial and strategic positioning of both companies.
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