D.R. Horton Earnings Preview: Analysts Anticipate Declines

D.R. Horton (DHI) is set to report earnings on April 17, 2025. Analysts expect a decline in both EPS and sales, raising concerns about future performance. Historical trends suggest the company sees positive returns post-earnings, despite recent order backlog declines.

Date: 17-04-2025

AI Rating: 4

D.R. Horton (NYSE: DHI) is on the verge of releasing its fiscal Q2 earnings, with analysts projecting earnings of $2.67 per share and revenues of $8.03 billion. This represents a significant decline from last year’s results, which saw earnings of $3.52 per share and revenues of $9.11 billion. This kind of decline can lead to investor concerns about future profitability and growth potential.

Earnings Per Share (EPS): D.R. Horton’s anticipated EPS of $2.67 indicates a 24% decrease, which could negatively impact investor sentiment and perceptions of the company's financial health. A steep drop in EPS may suggest underlying issues such as reduced demand or increased costs. This could lead some investors to reassess their valuation models for DHI, potentially affecting the stock price adversely.

Revenue Growth: The expected 12% fall in sales, compounded with a 21% drop in sales order backlog, indicates pressure on future revenue. If actual earnings come in below expectations, it could result in even greater stock price volatility as traders reassess the company's outlook. Such declines could signal a slowdown in housing demand, a critical factor for a homebuilder like D.R. Horton.

Net Income and Profit Margins: The report shows D.R. Horton achieved a net income of $4.7 billion with operating profits of $5.8 billion over the last twelve months, indicating that the company remains operationally profitable. However, declining orders suggest potential future pressures on these profit margins. Maintaining profitability may become challenging if costs rise or revenues continue to fall.

Historical data indicates that D.R. Horton shares generally respond positively to earnings announcements, with a noted median one-day rise of 3%. However, with the current declines in both EPS and revenues, there may be a divergence from this trend, causing a reassessment of future earning potentials.

Overall, while D.R. Horton has demonstrated resilience historically, concerns surrounding EPS and revenue growth could lead to volatility in stock price post-earnings announcement. Investors should prepare for potential fluctuations based on how the results compare against analysts' expectations.

Stocks: DHI