Financial Data and Key Metrics Changes - In 2025, the company delivered 8,921 homes and recorded revenue of $4.4 billion, with pre-tax income of nearly $590 million, down 20% from the previous year's record of $734 million [5][6] - The net income was $403 million, or $14.74 per share, with a return on equity of 13.1% and shareholders' equity increased by 8% year-over-year to $3.2 billion [6][10] - Gross margins for the full year were 24.4%, down 220 basis points from 2024, primarily due to higher incentives and lot costs [6][10] Business Line Data and Key Metrics Changes - The financial services segment achieved a record capture rate of 93% and pre-tax income of $56 million for the year [5][16] - The Smart Series product, which is the most affordably priced, accounted for 49% of total company sales in the fourth quarter, down from 52% a year ago [7] Market Data and Key Metrics Changes - New contracts in the Southern Region increased by 13% year-over-year, while the Northern Region saw a 4% increase [8] - Deliveries in the Southern Region represented 57% of the company-wide total, with a slight increase in homes delivered compared to the previous year [8] Company Strategy and Development Direction - The company is focused on maintaining quality and customer service while navigating economic challenges, and it is well-positioned in its 17 markets [3][10] - The company plans to continue using mortgage rate buydowns as incentives on a community-by-community basis to drive sales [6][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term fundamentals of the industry despite current challenges, stating that the company is in the best financial condition in its history [10] - There is optimism regarding the early traffic improvements and demand as the selling season begins [45][90] Other Important Information - The company ended the year with a cash balance of $689 million and zero borrowings under its unsecured credit facility, resulting in a strong debt-to-capital ratio of 18% [10][18] - The company owns approximately 26,000 lots, with an additional 24,000 lots controlled via option contracts, providing flexibility to respond to market conditions [9] Q&A Session Summary Question: Can you address the 13% growth in the South and bifurcate that into Texas and Florida? - Management noted solid sales across various markets, with Florida's Orlando market performing well and Texas showing mixed results, particularly with Dallas and Houston remaining solid while Austin and San Antonio were weaker [24][25] Question: Can you comment on margin pressures and the differential between intra-quarter closings and backlog? - Management acknowledged that margins are under pressure but noted that a significant portion of sales now comes from spec sales, which have lower margins compared to to-be-built homes [26][35] Question: What is the strategy regarding mortgage rate buy-downs? - The company has been successful with a 4.875% 30-year fixed mortgage rate and offers temporary buydowns to attract buyers [72][74] Question: How is the company structuring its land purchases and development? - Management indicated that land purchases and development spending increased, reflecting confidence in demand, but emphasized that there is no specific strategy driving this increase [64][66] Question: What is the outlook for margins and community openings? - Management did not provide specific guidance on margins but expressed optimism about maintaining a strong sales pace and improving margins through operational efficiencies [82][92]

M/I Homes (NYSE:MHO) Q4 2025 Earnings call January 28, 2026 10:30 AM ET Company ParticipantsAlan Ratner - Managing DirectorAlex Barron - PresidentBob Schottenstein - CEO and PresidentBuck Horne - Managing DirectorDerek Klutch - President of Mortgage OperationsJay McCanless - Managing DirectorPhil Creek - CFOConference Call ParticipantsKen Zener - Senior AnalystOperatorGood morning, ladies and gentlemen, and welcome to the M/I Homes fourth quarter and year-end earnings conference call. At this time, all line ...

Financial Data and Key Metrics Changes - In 2025, the company delivered 8,921 homes and recorded revenue of $4.4 billion, with pre-tax income of nearly $590 million, down 20% from last year's record of $734 million [5][6] - The net income was $403 million, or $14.74 per share, with a return on equity of 13.1% [6] - Full-year gross margins, excluding inventory and warranty charges, were 24.4%, down 220 basis points from 2024 [6][14] - The company ended the year with cash of $689 million and zero borrowings under its $900 million unsecured revolving credit facility, resulting in a strong debt-to-capital ratio of 18% [11][19] Business Line Data and Key Metrics Changes - The financial services segment achieved a record capture rate of 93% and pre-tax income of $56 million for the year [5] - The Smart Series, the company's most affordably priced product, comprised 49% of total sales in Q4, down from 52% a year ago [7] - The average closing price for Q4 was $484,000, a 1% decrease from the previous year's average of $490,000 [13] Market Data and Key Metrics Changes - New contracts in the Southern Region increased by 13% year-over-year, while the Northern Region saw a 4% increase [9] - Deliveries in the Southern Region represented 57% of the company-wide total, with a slight increase in homes delivered compared to the previous year [9] - The company owns approximately 26,000 lots, with 30% in the Northern Region and 70% in the Southern Region, and controls an additional 24,000 lots via option contracts [10] Company Strategy and Development Direction - The company is focused on maintaining quality and customer service while navigating economic challenges, positioning itself well in 17 markets [3][4] - The strategy includes using mortgage rate buydowns as incentives to promote sales, particularly in response to affordability challenges [6][35] - The company plans to open more communities in 2026, estimating a 5% increase in average community count compared to 2025 [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term fundamentals of the industry despite current challenges, noting a slight improvement in demand and traffic as they enter 2026 [11][46] - The company anticipates that margin pressures may not be as severe in 2026 as they were in 2025, with expectations for improved demand in the early months of the year [47][48] - Management acknowledged the impact of impairments primarily in entry-level communities and indicated a focus on addressing these issues to stabilize margins [48][52] Other Important Information - The company spent $524 million on land purchases and $646 million on land development in 2025, up from $1.1 billion in 2024 [19] - The average mortgage amount increased to $414,000 in Q4 2025, with a loan-to-value ratio of 83% [18] Q&A Session Summary Question: Can you address the 13% growth in the South and bifurcate it into Texas and Florida? - Management noted solid sales across various markets, with Florida's Orlando and Tampa markets performing well, while Texas markets showed mixed results [25][26] Question: Can you comment on margin pressures and the differential between intra-quarter closings and backlog? - Management indicated that a significant portion of sales now comes from spec sales, which generally have lower margins compared to to-be-built homes [34][36] Question: What is the outlook for margins and incentives in the upcoming quarter? - Management refrained from providing specific guidance on margins but acknowledged that incentives had increased slightly in Q4 [80] Question: How is the company structuring mortgage rate buydowns? - The company has been successful with a 4.875% 30-year fixed mortgage rate and temporary buydowns to attract buyers [71][72] Question: What are the trends in Florida markets and overall inventory? - Management expressed optimism about Florida markets, particularly Orlando and Tampa, and indicated that inventory levels are being managed carefully [66][100]

M/I Homes (MHO) came out with quarterly earnings of $3.91 per share, beating the Zacks Consensus Estimate of $3.88 per share. This compares to earnings of $4.71 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of +0.69%. A quarter ago, it was expected that this homebuilder would post earnings of $4.37 per share when it actually produced earnings of $4.14, delivering a surprise of -5.26%.Over the last four quarters, the company has ...

Financial Performance - In Q4 2025, M/I Homes reported a pre-tax income of $80.6 million and a net income of $64.0 million, down from $170.6 million and $133.5 million respectively in Q4 2024[5]. - For the full year 2025, pre-tax income was $526.6 million, a decrease of 28% from $733.6 million in 2024, with net income at $402.9 million compared to $563.7 million in 2024[5]. - Total revenue for 2025 was $4.4 billion, a decrease of 2% from $4.5 billion in 2024[6]. - For the three months ended December 31, 2025, net income was $63,971,000, a decrease of 52% compared to $133,469,000 for the same period in 2024[21]. - Adjusted EBITDA for the twelve months ended December 31, 2025, was $608,456,000, down 20.7% from $767,450,000 in 2024[21]. - Adjusted net income for the twelve months ended December 31, 2025, was $447,958,000, a decrease from $563,725,000 in 2024[25]. Contracts and Deliveries - New contracts in Q4 2025 increased by 9% to 1,921, while homes delivered decreased by 4% to 2,301 compared to Q4 2024[6]. - New contracts for the three months ended December 31, 2025, totaled 1,921 homes, representing a 9% increase from 1,759 homes in the same period of 2024[23]. - Homes delivered in the three months ended December 31, 2025, were 2,301, a decrease of 4% from 2,402 homes delivered in the same period of 2024[23]. Backlog and Inventory - Homes in backlog decreased by 29% to 1,809 units, with a sales value of $989.9 million, down from $1.4 billion in 2024[7]. - The total backlog as of December 31, 2025, was 1,809 units with an average sales price of $547,000, compared to 2,531 units with an average sales price of $553,000 as of December 31, 2024[23]. Shareholder and Equity Information - Shareholders' equity reached a record $3.2 billion, with a book value per share of $123, and a return on equity of 13%[8]. - M/I Homes repurchased $50 million of stock in Q4 2025 and $202 million for the full year[6]. Operational Metrics - The company ended 2025 with 232 active communities, an increase from 220 in 2024, and a cancellation rate of 10% in Q4 2025, down from 14% in Q4 2024[7]. - The average sales price in backlog decreased by 1% to $547,000 compared to $553,000 in 2024[7]. - Cash used in operating activities for the three months ended December 31, 2025, was $(8,707,000), compared to cash provided of $104,395,000 in the same period of 2024[19]. - Land purchases for the twelve months ended December 31, 2025, amounted to $523,689,000, an increase from $472,937,000 in 2024[19]. - Financial services pre-tax income for the twelve months ended December 31, 2025, was $55,656,000, up from $49,682,000 in 2024[19]. - The company reported a total of 25,652 lots owned and 24,329 lots under contract as of December 31, 2025, compared to 23,836 lots owned and 28,320 lots under contract as of December 31, 2024[23]. Debt and Financial Health - The company maintained a homebuilding debt to capital ratio of 18% and zero borrowings under its $900 million credit facility[8].

Core Viewpoint - M/I Homes and D.R. Horton are experiencing significant growth in home sales, driven by strong demand and favorable market conditions [1] Group 1: Company Performance - M/I Homes reported a 15% increase in home sales year-over-year, reflecting robust demand in the housing market [1] - D.R. Horton achieved a 20% rise in net sales for the last quarter, indicating strong consumer interest and effective sales strategies [1] Group 2: Market Trends - The housing market is showing resilience, with low mortgage rates and a limited supply of homes contributing to increased sales [1] - Both companies are expanding their operations in key markets, capitalizing on the ongoing demand for new homes [1]

Core Viewpoint - The article discusses the reliability of brokerage recommendations, particularly focusing on M/I Homes (MHO), and emphasizes the importance of using these recommendations in conjunction with other analytical tools for making investment decisions [1][5]. Brokerage Recommendations for M/I Homes - M/I Homes has an average brokerage recommendation (ABR) of 1.50, indicating a rating between Strong Buy and Buy, based on recommendations from four brokerage firms [2]. - Out of the four recommendations, three are Strong Buy, accounting for 75% of the total recommendations [2]. Limitations of Brokerage Recommendations - Solely relying on brokerage recommendations may not be advisable, as studies indicate they often fail to guide investors effectively towards stocks with high potential for price appreciation [5]. - Analysts from brokerage firms tend to exhibit a strong positive bias in their ratings due to vested interests, issuing five "Strong Buy" recommendations for every "Strong Sell" [6][11]. Comparison with Zacks Rank - The Zacks Rank, which classifies stocks from 1 (Strong Buy) to 5 (Strong Sell), is a more reliable indicator of near-term price performance, driven by earnings estimate revisions [8][12]. - Unlike the ABR, which may not be up-to-date, the Zacks Rank reflects timely changes in earnings estimates, providing a more accurate indication of future price movements [13]. Current Earnings Estimates for M/I Homes - The Zacks Consensus Estimate for M/I Homes remains unchanged at $16.44 for the current year, suggesting steady analyst views on the company's earnings prospects [14]. - The unchanged consensus estimate has resulted in a Zacks Rank of 3 (Hold) for M/I Homes, indicating a cautious approach despite the Buy-equivalent ABR [15].

Company Overview - M/I Homes (MHO) closed at $133.26, reflecting a -1.24% change from the previous day's closing price, underperforming the S&P 500's daily loss of 0.24% [1] - Over the past month, M/I Homes shares have appreciated by 8.73%, outperforming the Construction sector's gain of 4.09% and the S&P 500's gain of 1.31% [1] Upcoming Earnings - The upcoming earnings report for M/I Homes is scheduled for January 28, 2026, with an expected EPS of $4.11, indicating a 12.74% decline compared to the same quarter last year [2] - Revenue is anticipated to be $1.16 billion, reflecting a 3.41% decrease from the corresponding quarter of the prior year [2] Full Year Projections - For the full year, Zacks Consensus Estimates project earnings of $16.44 per share and revenue of $4.43 billion, representing changes of -16.59% and -1.55% respectively from the prior year [3] - Recent changes in analyst estimates for M/I Homes are crucial as they often indicate shifts in near-term business trends, with positive revisions suggesting analyst optimism [3] Valuation and Ranking - M/I Homes currently holds a Zacks Rank of 3 (Hold), with a Forward P/E ratio of 8.21, which is a discount compared to the industry average Forward P/E of 12.06 [5] - The Building Products - Home Builders industry, part of the Construction sector, has a Zacks Industry Rank of 218, placing it in the bottom 12% of all industries [6]

Core Points - M/I Homes, Inc. will announce its fourth quarter and year-end earnings on January 28, 2026, before the market opens [1] - The earnings announcement will be followed by a live webcast at 10:30 AM Eastern Time, accessible via the company's website [1] - The company is a leading homebuilder in the United States, with operations in multiple states including Ohio, Indiana, Illinois, Minnesota, Michigan, Florida, Texas, North Carolina, and Tennessee [2] Company Overview - M/I Homes, Inc. specializes in the construction of single-family homes [2] - The company operates in major metropolitan areas across the Midwest and Southeast regions of the United States [2]

Core Viewpoint - Analyst recommendations play a significant role in influencing stock prices, but their reliability is questionable due to potential biases from brokerage firms [1][6][11]. Brokerage Recommendation Summary - M/I Homes (MHO) has an average brokerage recommendation (ABR) of 1.40, indicating a consensus between Strong Buy and Buy, with 80% of the recommendations being Strong Buy from five brokerage firms [2][5]. - Despite the positive ABR, relying solely on this information for investment decisions may not be wise, as studies show limited success in brokerage recommendations guiding investors effectively [5][11]. Zacks Rank Comparison - The Zacks Rank, which is based on earnings estimate revisions, is a more reliable indicator of near-term stock performance compared to ABR, which is influenced by brokerage recommendations [8][12]. - The Zacks Rank for M/I Homes is 3 (Hold), indicating a cautious outlook despite the positive ABR [15]. Earnings Estimate Insights - The Zacks Consensus Estimate for M/I Homes remains unchanged at $16.21, suggesting steady analyst views on the company's earnings prospects [14]. - The lack of change in the consensus estimate may lead to M/I Homes performing in line with the broader market in the near term [14][15].