All right, let's get a power check on a couple of stocks preparing to report their earnings and one stock trading at its highest level of the year. First up, Cisco. That stock down a little bit ahead of its results after the bell tonight.Despite today's decline, shares still trading at levels not since seen since the year 2000. Remember Cisco briefly, the biggest company in the world. John Deere also on deck.Investors will be watching for how tariffs might have been impacting its overall business. And then ...

Group 1 - The article presents a bullish thesis for D.R. Horton, Inc. (NYSE: DHI), a company in the homebuilding industry, which is part of the consumer discretionary sector [1] - D.R. Horton focuses on building homes and aims to capitalize on market opportunities as an individual investor approaches retirement [1] Group 2 - The author expresses a beneficial long position in D.R. Horton shares, indicating confidence in the company's future performance [2] - The article emphasizes the importance of having both long-term and short-term trading strategies to maximize investment results [1]

Core Viewpoint - D.R. Horton, Inc. (DHI) shares are experiencing upward movement, indicating a potential breakout that could lead to a new uptrend [1] Price Dynamics - Support levels are price points where buying interest is significant, preventing further declines, while resistance levels are where selling interest is high, halting price increases [2] - The stock previously fell sharply in late October, finding support around $151, but broke this support in December, leading to buyer regret [3][5] Market Behavior - Many investors chose to hold their losing positions, hoping to exit at breakeven, which resulted in a concentration of sell orders at the previous support level of $151, now acting as resistance [5] - A false breakout can occur when a stock appears to break resistance but quickly reverses downward [6] - A true breakout happens when buyers surpass sellers at resistance, indicating that sellers have exited the market, potentially leading to a new uptrend for D.R. Horton [7]

Core Viewpoint - The current earnings season has seen several companies announce significant increases in share buyback authorizations, which can positively impact their earnings per share and share prices. Group 1: Charles Schwab - Charles Schwab reported strong earnings on July 18, beating estimates on both sales and adjusted EPS, leading to a 3% increase in share price [2][3] - On July 24, Schwab announced a new buyback authorization of $20 billion, nearly tripling its previous capacity of $6.9 billion, which represents 11.3% of its market capitalization [3][4] Group 2: D.R. Horton - D.R. Horton experienced a nearly 17% surge in shares after reporting fiscal Q3 2025 earnings on July 22, significantly exceeding sales and adjusted EPS estimates [7][9] - The company plans to increase buyback spending to between $4.2 billion and $4.4 billion for fiscal 2025, up from a previous forecast of $4 billion, indicating a commitment to reducing its share count by 1.4% to 1.9% next quarter [8][9] Group 3: Bank of America - Bank of America announced a substantial increase in its buyback capacity to $40 billion from $9.1 billion, which is approximately 11.1% of its market capitalization [10][11] - The bank reported solid earnings on July 16, beating adjusted EPS estimates but slightly missing on sales, with shares up around 5% since the report [12] Group 4: Teledyne Technologies - Teledyne Technologies reported record revenue of $1.5 billion for Q2, beating sales and adjusted EPS estimates, although shares fell slightly post-results [14][15] - The company announced a new $2 billion buyback authorization, doubling its previous capacity and representing 7.7% of its market capitalization [15][16] Group 5: Overall Market Implications - The trend of increasing buybacks among these firms reflects management confidence in their businesses and a commitment to returning capital to shareholders, which is seen as a positive signal for investors [16]

Group 1 - D.R. Horton, Inc. (NYSE: DHI) shares have increased by over 17% following a positive earnings report, indicating that the worst of the cycle may be behind the company [1] Group 2 - The company aims to invest in firms with strong qualitative attributes, purchasing them at attractive prices based on fundamentals, and holding them long-term [2] - The investment strategy focuses on maintaining a concentrated portfolio to avoid underperformers while maximizing exposure to high-potential winners [2]

Group 1 - The logistics sector has seen significant engagement from investors, particularly in the ASEAN and US markets, with a focus on banks, telecommunications, logistics, and hotels [1] - The popularity of insurance companies in the Philippines has influenced investment strategies, leading to diversification beyond traditional savings in banks and properties [1] - The investment approach has evolved from focusing solely on blue-chip companies to a more diversified portfolio across various industries and market capitalizations [1] Group 2 - The entry into the US market occurred in 2020, following a period of learning and analysis through platforms like Seeking Alpha [1] - The investor has holdings in US banks, hotels, shipping, and logistics companies, indicating a strategic approach to portfolio diversification [1] - The comparative analysis between the US and Philippine markets has been a key aspect of the investment strategy, enhancing market awareness and decision-making [1]

Core Viewpoint - The article discusses the investment perspective on D.R. Horton Inc. (NYSE: DHI), highlighting a previous hold rating due to valuation concerns despite a favorable demand outlook [1]. Company Analysis - D.R. Horton Inc. is noted for its decent demand outlook, which may present potential investment opportunities [1]. - The author emphasizes a cautious approach to the stock's valuation, indicating that it may not be an attractive buy at current levels [1]. Investment Strategy - The author employs a diverse investment strategy that includes fundamental, technical, and momentum investing, suggesting a comprehensive approach to capital management [1]. - The intention behind writing on Seeking Alpha is to track investment ideas and connect with like-minded investors, indicating a focus on community engagement and performance tracking [1].

Financial Performance - Consolidated revenues decreased 8% to $24.6 billion compared to $26.8 billion for the nine months ended June 30, 2025[121] - Net income attributable to D.R. Horton decreased 24% to $1.0 billion compared to $1.4 billion[130] - Net income attributable to D.R. Horton decreased 23% to $2.7 billion compared to $3.5 billion[139] - Pre-tax income for the three months ended June 30, 2025, was $54.8 million, down from $64.2 million in the prior year, reflecting a decrease in revenues[196] - Revenues for the nine months ended June 30, 2025, were $22.77 billion, with a net income of $2.39 billion[267] Home Sales and Closures - Homes closed decreased 7% to 23,160 homes, and the average closing price of those homes decreased 3% to $369,600[130] - Homes closed decreased 7% to 61,495 homes, with an average closing price decrease of 2% to $372,200[139] - Net sales orders decreased 6% to 63,345 homes, with a value decrease of 8% to $23.4 billion[139] - For the three months ended June 30, 2025, homes closed decreased by 4% to 23,160 homes, generating $8.56 billion in revenue, a 7% decline from $9.23 billion in the prior year[157] Margins and Profitability - Home sales gross margin decreased to 21.8% compared to 24.0% due to increased sales incentives[123] - Homebuilding pre-tax income decreased 22% to $3.1 billion, representing 13.7% of homebuilding revenues compared to 16.1%[139] - Gross profit from home sales for the three months ended June 30, 2025, was $1.9 billion, representing a gross margin of 21.8%, a decrease of 220 basis points from the prior year[161] - The gross profit margin for rental operations was 22.2% for the three months ended June 30, 2025, slightly down from 22.5% in the prior year[194] Rental Revenues - Rental revenues decreased to $380.7 million compared to $413.7 million[134] - Rental revenues decreased to $835.0 million compared to $980.2 million[139] - Rental revenues decreased to $380.7 million for the three months ended June 30, 2025, compared to $413.7 million in the same period of 2024, representing a decline of 8%[195] Debt and Equity - Stockholders' equity was $24.1 billion compared to $25.3 billion at September 30, 2024[130] - Debt to total capital increased to 23.2% compared to 18.9% at September 30, 2024[130] - The company's debt to total capital ratio increased to 23.2% at June 30, 2025, compared to 18.9% at September 30, 2024[223] - At June 30, 2025, the company had outstanding notes payable totaling $7.3 billion, with $2.4 billion due within 12 months[222] Inventory and Backlog - As of June 30, 2025, the total homes in backlog decreased by 16% to 14,075 homes, with a backlog value of $5.34 billion, down 19% from the previous year[152] - The overall homebuilding segment's total inventory as of June 30, 2025, was $21,098.2 million, compared to $20,031.0 million as of September 30, 2024[184] - The company controlled a total of 601,400 lots as of June 30, 2025, with 38,400 homes in inventory, compared to 632,900 lots and 37,400 homes in inventory on September 30, 2024[190] Regional Performance - The number of homes closed in the Southeast region decreased by 15% to 5,682 homes, with a revenue drop of 20% to $1.92 billion[154] - Homebuilding revenues in the Northwest region decreased by 4% and 7% for the three and nine months ended June 30, 2025, respectively, with pre-tax income of $116.4 million and $286.3 million[175] - The Southwest region experienced a 10% and 7% decrease in homebuilding revenues for the three and nine months ended June 30, 2025, with pre-tax income of $152.7 million and $444.4 million[176] - The Southeast region saw a significant 20% decrease in homebuilding revenues for both the three and nine months ended June 30, 2025, with pre-tax income of $224.6 million and $658.7 million[179] Financial Services - Financial services revenues decreased 6% to $227.8 million compared to $242.3 million[134] - Total revenues from financial services operations decreased by 6% to $227.8 million for the three months ended June 30, 2025, compared to $242.3 million in the prior year[211] - General and administrative expenses for financial services decreased by 4% to $171.0 million in the three months ended June 30, 2025, from $178.0 million in the prior year[212] Shareholder Returns - The company repurchased 26.2 million shares at a total cost of $3.6 billion during the nine months ended June 30, 2025[231] - Cash dividends declared and paid in the nine months ended June 30, 2025, totaled $376.4 million, with a quarterly cash dividend of $0.40 per common share approved for July 2025[258] Tax and Compliance - The effective tax rate for the three months ended June 30, 2025, was 23.9%, compared to 24.0% in the prior year[217] - The company recognized a tax benefit of $70.4 million related to the energy efficient home tax credit in fiscal 2024, and $30.8 million in the nine months ended June 30, 2025[219] Cash Flow - The net cash provided by operating activities for the nine months ended June 30, 2025, was $949.1 million, compared to $228.2 million in the prior year period[252] - Cash used to increase residential land and lots was $1.5 billion in the current year period, down from $2.0 billion in the prior year period[253] - During the nine months ended June 30, 2025, net cash used in financing activities was $2.7 billion, primarily for share repurchases totaling $3.6 billion[256]

Core Insights - D.R. Horton, Inc. surpassed third-quarter revenue and earnings expectations, yet its shares experienced a decline despite positive guidance for 2025 and projected growth [1][6] Financial Performance - The company reported fiscal third-quarter revenue of $9.22 billion, exceeding analyst estimates of $8.79 billion [2] - Earnings per share for the third quarter were $3.36, surpassing analyst expectations of $2.92 [2] Growth Projections - D.R. Horton refined its 2025 revenue guidance to a range of $33.7 billion to $34.2 billion and forecasted home closings between 85,000 and 85,500 units [4] - The company is expected to achieve earnings growth in fiscal 2026, driven by mid-single-digit community expansion and a 24% quarterly, 11% annual increase in starts [3][4] Market Position and Strategy - The company's strong performance is attributed to its significant presence in smaller markets with fewer public spec builders and a 12% year-over-year increase in community count [4] - D.R. Horton maintained a core fourth-quarter gross margin of 21.8%, above the expected range of 21.0% to 21.5%, despite higher incentives [5] Analyst Insights - Bank of America Securities analyst Rafe Jadrosich reiterated a Neutral rating on D.R. Horton, raising the price forecast from $135 to $155 [1] - Jadrosich increased EPS estimates for fiscal years 2025 and 2026 by 8% and 1%, respectively [6]

There is a limit to how many different companies and sectors one can reasonably follow, but with how quickly news flows, it is tempting to stretch one’s bounds. Using various tools and data sources, one can get reasonably informed on a company in a very short amount of time. However, in this haste, narratives are often driven by stock prices as much as they are by fundamentals. That is the concept I want to discuss today – stock price driven narratives not backed by fundamentals. D.R. Horton, Inc.'s (NYSE:D ...