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MATAWAN, NJ - Hovnanian Enterprises Inc. (NYSE:HOV), a leading home construction company with a market capitalization of $527 million, announced today that its Board of Directors has approved an additional $25 million for its stock repurchase program. This move increases the total authorization for buybacks to $30.6 million, inclusive of any remaining funds from prior authorizations. According to InvestingPro data, the stock appears undervalued at its current price of $89.93, trading at an attractive P/E ratio of 2.51x.
The decision, made on Friday, April 11, 2025, follows a previous expansion of the program on December 18, 2024, and the initial authorization on September 1, 2022. The company’s repurchase program allows for the buyback of Class A common stock through various means, including open market transactions, privately negotiated deals, or other methods.
The timing and volume of repurchases will be subject to market conditions, legal requirements, price considerations, and potential tax consequences. Hovnanian’s management has indicated that the repurchase plan is flexible and can be altered, paused, or terminated at any time, and it does not have a fixed expiration date.
The repurchase program reflects the company’s ongoing efforts to manage its capital and return value to its shareholders. Stock buybacks are a common strategy used by companies to reduce the number of shares on the market, potentially increasing the value of remaining shares and earnings per share.
This announcement is based on a press release statement from Hovnanian Enterprises Inc. and is intended to provide shareholders and the market with updated information on the company’s financial strategies.
In other recent news, Hovnanian Enterprises reported a 13% year-over-year increase in Q1 2025 revenue, reaching $674 million. Despite this growth, the company’s gross margin decreased to 18.3%, primarily due to increased sales incentives, which has raised concerns among investors. The company’s forward guidance suggests revenue for Q2 2025 is expected to range between $675 million and $775 million, with an adjusted gross margin anticipated between 17.5% and 18.5%. Hovnanian also expanded its community presence by opening 15 new communities, contributing to a 10% year-over-year increase in open communities. Analysts noted that the company emphasized growth in Quick Move-In homes, which accounted for 69% of total sales. The company’s leadership remains optimistic about substantial delivery and revenue growth throughout FY2025. Additionally, Hovnanian’s focus on maintaining high inventory turnover rates and expanding its community footprint suggests a strategic emphasis on long-term growth.
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