Homebuilder DR Horton posts 81% sales spike as coronavirus prompts flight to suburbs
Net sales orders increased 81%
National Association of Home Builders President and CEO Jerry Howard argues his industry is doing very well despite dealing with high material costs and labor shortages.
D.R. Horton Inc. reported strong fourth-quarter results and guided above Wall Street expectations as low interest rates and a flight to the suburbs amid the COVID-19 pandemic fueled a building boom.
The Arlington, Texas-based homebuilder reported fourth-quarter profit surged 64% from a year ago to $829 million, or $2.24 per share. Wall Street analysts surveyed by Refinitiv were expecting a profit of $1.76 per share.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| DHI | D.R. HORTON INC. | 170.74 | +3.10 | +1.85% |
Revenue totaled $6.4 billion as the number of homes closed rose 26% year-over-year to 20,248. Net sales orders soared 81% from a year ago to 23,726 as the cancellation rate fell 4 percentage points to 19%.
“The D.R. Horton team finished the year strong,” Donald R. Horton, chairman of the board, said in a statement. “With a record 65,388 homes closed in fiscal 2020, D.R. Horton completed its 19th consecutive year as the largest homebuilder in the United States.”
For the full year, D.R. Horton earned $2.4 billion, or a diluted $6.41 per share, as revenue increased 15% to $20.3 billion.
The company increased its quarterly dividend by 2.5 cents to 20 cents per share.
Looking ahead, D.R. Horton expects to build between 77,000 and 80,000 units in the current fiscal year, compared with analysts' average estimate of 75,981. Consolidated revenues are forecast between $24 billion and $25 billion.
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Shares were up 23% this year through Monday, outperforming the S&P 500’s 9.9% gain.