Why D.R. Horton Shares Are Trading Higher Today

Builder D.R. Horton, Inc DHI shares are surging Thursday morning following its solid third-quarter FY23 results.

DHI reported sales growth of 10.7% year-over-year to $9.725 billion, beating the consensus of $8.39 billion.

EPS was $3.90 (-16% Y/Y), beating the consensus of $2.79.

Home sales revenues were $8.7 billion (+4.4% Y/Y) on 22,985 homes closed (+8% Y/Y).

Q3 Net sales orders increased 37% Y/Y to 22,879 homes and +26% Y/Y in value to $8.7 billion.

DHI repurchased 3.1 million shares of common stock for $342.9 million during the quarter.

The company’s sales order backlog of homes under contract on June 30, 2023, decreased 34% to 19,186 homes and 38% in value to $7.4 billion compared to a year ago.

DHI had 43,800 homes in inventory, of which 25,000 were unsold as of June 30, 2023.

Return on equity or ROE was 24.3% for the trailing twelve months ended June 30, 2023, and homebuilding return on inventory (ROI) was 31.8%.

The Arlington, Texas-based company ended Q3 with $2.6 billion of unrestricted homebuilding cash and $2 billion of available capacity on its revolving credit facility for total homebuilding liquidity of $4.6 billion. 

DHI generated $2.3 billion of operating cash flow during the nine months ended June 30, 2023. 

Homebuilding debt on June 30, 2023, totaled $2.7 billion, and homebuilding debt to total capital ratio was 11.1%. 

Dividend: The company declared a quarterly cash dividend of $0.25 per common share payable on August 14, 2023, to stockholders of record on August 7, 2023.

FY23 Outlook: DHI raised its outlook and now sees revenue of $34.7 billion-$35.1 billion (prior view $31.5 billion-$33 billion) versus the consensus of $32.3 billion.

It expects Homes closed to be between 82,800-83,300 (prior 77,000-80,000) homes and Rental homes/units closed between 6,500-7,000 (prior 4,000-5,000) homes/units.

DHI expects cash provided by operations greater than $3 billion.

Price Action: DHI shares are trading higher by 3.83% at $132.75 premarket on Thursday.

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