Core Viewpoint - D.R. Horton, Inc. reported first-quarter fiscal 2025 results with earnings and revenues exceeding expectations but showing a decline year-over-year, leading to a 6% increase in share price post-earnings release [1] Financial Performance - Adjusted earnings were $2.61 per share, beating the Zacks Consensus Estimate of $2.40 by 8.8%, but down 7.4% from $2.82 a year ago [4] - Total revenues reached $7.6 billion, a decrease of 1.5% year-over-year, yet above the analysts' expectation of $7.13 billion [4] - The consolidated pre-tax profit margin was 14.6%, down from 16.1% a year ago [5] Segment Performance - Homebuilding revenues were $7.17 billion, down 1.8% from the prior-year quarter, with home sales at $7.15 billion, also down 1.8% [6] - Net sales orders decreased by 1% year-over-year to 17,837 homes, with the value of net orders down 2% to $6.7 billion [7] - Financial Services revenues fell 5.3% to $182.3 million, while Forestar contributed $250.4 million, down from $305.9 million a year ago [8] Balance Sheet and Liquidity - Cash, cash equivalents, and restricted cash totaled $3.07 billion, down from $4.54 billion at the end of fiscal 2024, with total liquidity at $6.5 billion [9] - The company had 36,200 homes in inventory, with 25,700 unsold, and a debt of $5.1 billion, resulting in a debt to total capital ratio of 17% [10] Shareholder Returns - D.R. Horton repurchased 6.8 million shares for $1.1 billion in the fiscal first quarter, with a remaining stock repurchase authorization of $2.5 billion [11] Fiscal 2025 Guidance - The company expects consolidated revenues between $36 billion and $37.5 billion, with homes closed anticipated to be between 90,000 and 92,000 units [12]

Financial Performance - Net income per diluted share decreased 7% to $2.61 in Q1 fiscal 2025 compared to $2.82 in Q1 fiscal 2024[2] - Consolidated revenues decreased 1% to $7.6 billion in Q1 fiscal 2025 compared to $7.7 billion in Q1 fiscal 2024[2] - Net income attributable to D.R. Horton decreased 11% to $844.9 million in Q1 fiscal 2025 compared to $947.4 million in Q1 fiscal 2024[2] - Net income decreased by 10.9% from $955.7 million to $851.9 million[32] - Basic net income per common share decreased from $2.84 to $2.63, a decline of 7.4%[32] - Consolidated income before income taxes was $1,109.9 million in Q4 2024, down from $1,247.5 million in Q4 2023[39] Revenue and Sales - Homes closed decreased 1% to 19,059 in Q1 fiscal 2025 compared to 19,340 in Q1 fiscal 2024[9] - Net sales orders decreased 1% to 17,837 homes and 2% in value to $6.7 billion in Q1 fiscal 2025 compared to 18,069 homes and $6.8 billion in Q1 fiscal 2024[12] - Homebuilding segment revenue for Q4 2024 was $7,146.0 million, a slight decrease from $7,276.4 million in Q4 2023[39] - Total homes closed in Q4 2024 were 17,837 with a value of $6.6535 billion, compared to 18,069 homes and $6.7895 billion in Q4 2023[42] - Sales order backlog as of December 31, 2024, was 11,003 homes valued at $4.299 billion, down from 13,965 homes and $5.4428 billion in 2023[46] - Northwest region homes closed in Q4 2024 were 1,019 valued at $533.7 million, down from 1,179 homes and $595.8 million in Q4 2023[42] - North region homes closed in Q4 2024 were 2,076 valued at $898.3 million, up from 1,793 homes and $723.8 million in Q4 2023[42] Rental Operations - Rental operations generated $11.9 million of pre-tax income on revenues of $217.8 million in Q1 fiscal 2025 compared to $31.3 million of pre-tax income on revenues of $195.3 million in Q1 fiscal 2024[14] - Rental segment revenue increased to $217.8 million in Q4 2024, up from $195.3 million in Q4 2023[39] - Rental properties inventory increased to $2,988.9 million as of December 31, 2024, from $2,906.0 million as of September 30, 2024[36] Financial Services - Financial services revenues were $182.3 million in Q1 fiscal 2025 compared to $192.6 million in Q1 fiscal 2024[19] - Financial services revenue was $182.3 million in Q4 2024, compared to $192.6 million in Q4 2023[39] Share Repurchases and Cash Flow - The Company repurchased 6.8 million shares of common stock for $1.1 billion during Q1 fiscal 2025[21] - Consolidated cash flow provided by operations is expected to be greater than fiscal 2024[26] - Net cash provided by operating activities improved significantly from a negative $153.4 million to a positive $646.7 million[34] - Net cash used in financing activities increased by 469.5% from $362.8 million to $2,064.6 million[34] - Repurchases of common stock increased by 180.2% from $376.9 million to $1,055.7 million[34] - Cash provided by operating activities was $646.7 million in Q4 2024, compared to a cash used in operating activities of $153.4 million in Q4 2023[39] Inventory and Assets - Total cash, cash equivalents, and restricted cash decreased from $4,544.0 million to $3,069.0 million, a decline of 32.5%[30] - Total inventory increased by 4.7% from $24,903.2 million to $26,080.5 million[30] - Residential land and lots increased by 9.7% from $13,121.4 million to $14,390.2 million[30] - Mortgage loans held for sale decreased by 27.6% from $2,477.5 million to $1,794.4 million[30] - Total liabilities decreased by 6.9% from $10,279.9 million to $9,566.8 million[30] - Cash and cash equivalents decreased to $3,050.1 million as of December 31, 2024, from $4,516.4 million as of September 30, 2024[36] - Residential land and lots inventory increased to $14,390.2 million as of December 31, 2024, from $13,121.4 million as of September 30, 2024[36] - Mortgage loans held for sale decreased to $1,794.4 million as of December 31, 2024, from $2,477.5 million as of September 30, 2024[36] - Homes in inventory decreased to 36,200 as of December 31, 2024, from 37,400 as of September 30, 2024[52] - East region homes in inventory decreased to 7,300 as of December 31, 2024, from 7,500 as of September 30, 2024[52] Regional Performance - Southeast region sales order backlog as of December 31, 2024, was 2,486 homes valued at $898.2 million, down from 4,123 homes and $1.5885 billion in 2023[46] - South Central region lots controlled increased to 157,800 as of December 31, 2024, from 148,600 as of September 30, 2024[48] - Forestar-controlled lots increased to 43,800 as of December 31, 2024, from 37,700 as of September 30, 2024[50] Expenses - Selling, general and administrative expenses increased to $878.1 million in Q4 2024, up from $835.0 million in Q4 2023[39] Land and Lots - Forestar sold 2,333 lots and generated $250.4 million of revenue in Q1 fiscal 2025 compared to 3,150 lots and $305.9 million of revenue in Q1 fiscal 2024[18] - Total lots controlled as of December 31, 2024, were 639,800, with 24% owned and 76% under purchase contracts[48]

Financial Data and Key Metrics - The company is discussing its financial results for the first quarter of fiscal 2025 [3] - The call includes forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995, indicating potential future financial performance [3] - The company believes these forward-looking statements are based on reasonable assumptions but acknowledges that actual outcomes may differ materially [3] Business Line Data and Key Metrics - No specific data on individual business lines or key metrics is provided in the content [1][2][3][4] Market Data and Key Metrics - No specific market data or key metrics are mentioned in the content [1][2][3][4] Company Strategy and Industry Competition - No specific details on company strategy or industry competition are provided in the content [1][2][3][4] Management Commentary on Operating Environment and Future Outlook - The company has made forward-looking statements regarding its future performance, but no specific commentary on the operating environment or future outlook is provided [3][4] Other Important Information - The call is being recorded, and participants are in listen-only mode until the Q&A session [2] - The company does not undertake any obligation to update or revise forward-looking statements after the call [4] Q&A Session Summary - No Q&A session details are provided in the content [1][2][3][4]

Core Insights - D.R. Horton reported a revenue of $7.61 billion for the quarter ended December 2024, reflecting a decrease of 1.5% year-over-year, while EPS was $2.61, down from $2.82 in the previous year [1] - The revenue exceeded the Zacks Consensus Estimate of $7.13 billion by 6.79%, and the EPS also surpassed the consensus estimate of $2.40 by 8.75% [1] Financial Performance Metrics - Homes Closed: 19,059, exceeding the average estimate of 17,963 by 14 analysts [4] - Net Sales Order - Homes Sold: 17,837, slightly below the average estimate of 18,485 by 14 analysts [4] - Sales Order Backlog - Homes in Backlog: 11,003, lower than the average estimate of 12,871 by 12 analysts [4] - Sales Order Backlog - Value: $4.30 billion, below the average estimate of $5.03 billion by 12 analysts [4] - Net Sales Order - Value: $6.65 billion, compared to the average estimate of $6.97 billion by 10 analysts [4] Revenue Breakdown - Revenues from Home Sales - Homebuilding: $7.15 billion, exceeding the average estimate of $6.79 billion based on 16 analysts, representing a year-over-year change of -1.8% [4] - Revenues from Financial Services: $182.30 million, slightly above the average estimate of $180.88 million by 16 analysts, showing a -5.4% change year-over-year [4] - Revenues from Rental: $217.80 million, surpassing the average estimate of $207.44 million by 15 analysts, with a year-over-year increase of +11.5% [4] - Revenues from Land/Lot Sales and Other - Homebuilding: $21.20 million, exceeding the average estimate of $19.09 million by 10 analysts, reflecting a year-over-year change of +4.4% [4] - Revenues from Forestar: $250.40 million, below the average estimate of $324.69 million based on six analysts, indicating a year-over-year decline of -18.1% [4] - Revenues from Eliminations and Other: -$204.70 million, better than the average estimate of -$268.32 million by four analysts, representing a year-over-year change of -22.6% [4] Stock Performance - D.R. Horton shares have returned +5.4% over the past month, outperforming the Zacks S&P 500 composite's +1.2% change [3] - The stock currently holds a Zacks Rank 4 (Sell), suggesting potential underperformance relative to the broader market in the near term [3]

Core Insights - D.R. Horton reported better-than-expected fiscal 2025 first-quarter earnings, with EPS of $2.61 and revenue of $7.61 billion, despite a 1.5% year-over-year decline [1][4] - The company attributed increased buyer activity to incentives like mortgage rate buydowns, which helped address affordability challenges [2][4] - D.R. Horton plans to increase its stock buyback program to between $2.6 billion and $2.8 billion, up from a previous estimate of $2.4 billion [2][4] Financial Performance - Fiscal 2025 Q1 EPS was $2.61, exceeding analysts' expectations [1] - Revenue for the quarter was $7.61 billion, reflecting a 1.5% decline year-over-year [1] - The company's shares gained nearly 2% on the reporting day but remain slightly lower over the past year [3] Market Conditions - Executive Chair David Auld noted that demographics supporting housing demand remain favorable despite buyer affordability challenges [2] - The company is responding to high home prices by starting and selling more homes with smaller floor plans to meet demand [2]

Group 1 - D.R. Horton reported quarterly earnings of $2.61 per share, exceeding the Zacks Consensus Estimate of $2.40 per share, but down from $2.82 per share a year ago, representing an earnings surprise of 8.75% [1] - The company achieved revenues of $7.61 billion for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 6.79%, although this is a decrease from year-ago revenues of $7.73 billion [2] - D.R. Horton has outperformed the S&P 500 with a 5.6% increase in shares since the beginning of the year, compared to the S&P 500's gain of 2% [3] Group 2 - The company's earnings outlook is crucial for investors, including current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The trend of estimate revisions for D.R. Horton has been unfavorable, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] - The current consensus EPS estimate for the upcoming quarter is $3.20 on revenues of $8.73 billion, and for the current fiscal year, it is $13.97 on revenues of $37.24 billion [7] Group 3 - The Building Products - Home Builders industry, to which D.R. Horton belongs, is currently ranked in the bottom 14% of over 250 Zacks industries, suggesting potential challenges for stock performance [8] - Another company in the same industry, Toll Brothers, is expected to report quarterly earnings of $1.99 per share, reflecting a year-over-year decline of 11.6%, with revenues projected at $1.9 billion, down 2.6% from the previous year [9]

Core Viewpoint - D.R. Horton Inc. is expected to report a decline in earnings and revenues for the first quarter of fiscal 2025, with significant challenges stemming from high mortgage rates and inflationary pressures [1][4][9]. Revenue Estimates - The Zacks Consensus Estimate for D.R. Horton's earnings per share (EPS) is $2.40, reflecting a 14.9% decline from the previous year's $2.82 [3]. - Total revenues are projected to be between $6.8 billion and $7.3 billion, down from $7.7 billion reported a year ago, indicating a year-over-year decline of approximately 7.7% [4][3]. - Homebuilding revenues, which constitute the majority of total revenues, are expected to decline by 8.4% year over year to $6.69 billion due to a decrease in homes closed [6][5]. Segment Performance - The Homebuilding segment, contributing 89.5% of total revenues in the previous quarter, is anticipated to see a decline in closed homes, with estimates between 17,500 and 18,000 units, down from 19,340 units a year ago [5][6]. - Rental Property revenues are expected to be $184.5 million, reflecting a 5.6% decline from the previous year [7]. - Financial Services segment revenues are projected to increase by 2.5% year over year to $197.3 million [8]. Margin Expectations - The home sales gross margin is expected to contract to 22.4% from 22.9% reported a year ago, influenced by inflation and supply chain concerns [9]. - Homebuilding selling, general and administrative (SG&A) expenses are expected to rise to approximately 8.9% of revenues, compared to 8.3% reported a year ago [10]. Orders and Backlog - Net sales orders are predicted to increase by 3.1% year over year to 18,629 units, while the backlog is expected to decrease to 13,032 units, down from 13,965 units a year ago [12]. - The value of the backlog is estimated to be $5.07 billion, indicating a decline of 6.8% year over year [12]. Earnings Prediction - The current model does not predict an earnings beat for D.R. Horton, with an Earnings ESP of +1.96% and a Zacks Rank of 4 (Sell) [13].

Company Overview - D R Horton Inc (NYSE DHI) is the largest homebuilding company in the US based on the number of homes closed [1] - The company builds and sells houses across 125 different markets in 36 different states [1] Business Segments - The company's business segments consist of various operations related to homebuilding [1] Analyst's Perspective - The analyst focuses on identifying small cap companies with strong fundamentals and growth potential [1] - The analyst also looks for large cap companies going through temporary setbacks and stable companies with solid dividend yields and growth potential [1] Analyst's Background - The analyst has a strong quantitative background with a PhD in Chemical Engineering from the University of California Santa Barbara specializing in model predictive control [1] - The analyst also holds an MBA from the Jones School of Business at Rice University [1]

Financial Performance - D.R. Horton is set to release its first-quarter financial results on January 21, 2025, with expected earnings of $2.38 per share, a decrease from $2.82 per share in the same period last year [1] - The company projects quarterly revenue of $7.08 billion, down from $7.73 billion a year earlier [1] - The fourth-quarter results reported on October 29 were worse than expected, indicating potential challenges in performance [1] Stock Performance - D.R. Horton shares increased by 0.8%, closing at $146.60 [2] - Recent analyst ratings show a mix of opinions, with some maintaining ratings while others have downgraded the stock [3] Analyst Ratings - Barclays analyst maintained an Equal-Weight rating and reduced the price target from $170 to $150 [3] - UBS analyst kept a Buy rating but lowered the price target from $214 to $203 [3] - Citigroup analyst maintained a Neutral rating and cut the price target from $185 to $152 [3] - JP Morgan downgraded the stock from Neutral to Underweight, reducing the price target from $188 to $156 [3] - Raymond James downgraded the stock from Outperform to Market Perform [3]

Core Viewpoint - Analysts expect D.R. Horton (DHI) to report quarterly earnings of $2.41 per share, reflecting a year-over-year decline of 14.5%, with revenues projected at $7.13 billion, down 7.7% from the previous year [1]. Revenue Estimates - Home sales revenue is estimated to be $6.79 billion, indicating a decrease of 6.6% year-over-year [4]. - Financial Services revenue is projected at $180.88 million, down 6.1% from the prior year [4]. - Rental revenue is expected to reach $207.45 million, showing an increase of 6.2% compared to the previous year [4]. - Homebuilding revenue is forecasted at $6.86 billion, reflecting a 6% decline year-over-year [5]. Geographic Revenue Projections - Homebuilding revenue in the Northwest is expected to be $521.59 million, down 9.7% year-over-year [5]. - Homebuilding revenue in the North is projected at $858.71 million, indicating an increase of 17.6% from the prior year [5]. - Homebuilding revenue in the Southwest is estimated at $974.10 million, down 7.4% year-over-year [6]. - Homebuilding revenue in South Central is expected to reach $1.46 billion, reflecting a decrease of 12.3% from the previous year [6]. Key Metrics - Analysts predict that the number of homes closed will be 17,963, down from 19,340 in the same quarter last year [7]. - Net sales orders for homes sold are expected to reach 18,485, compared to 18,069 in the previous year [7]. - The average selling price for homes closed is estimated at $375.67 million, slightly down from $376.20 million in the same quarter last year [8]. - The average selling price for sales order backlog is projected at $390.97 million, compared to $389.70 million a year ago [8]. Market Performance - D.R. Horton shares have decreased by 2.4% over the past month, compared to a 3.3% decline in the Zacks S&P 500 composite [8].