D.R. Horton Inc. (NYSE:DHI) Sees Share Slide

D.R. Horton Inc. experienced a 5% decline in share price during premarket trading on Tuesday after the Q4 estimates fell short on both earnings and revenue, alongside weak guidance for fiscal 2025.

Q4 Financial Performance

For the fourth quarter, the home construction company reported:
– Earnings per Share (EPS): $3.92 (vs. $4.18 expected)
– Revenue: $10 billion (below the anticipated $10.21 billion)
– Net Sales Orders: Totalled $7.15 billion, down 2.1% year-over-year and less than the $7.52 billion estimate.
– Backlog: Reported at $4.77 billion, a 19% decline year-over-year, also missing the expected $4.97 billion.

Guidance for Fiscal Year 2025

D.R. Horton projects revenue between $36 billion and $37.5 billion, missing the analyst consensus of $39.41 billion.

Executive Comments

David Auld, Executive Chairman of D.R. Horton, remarked:
> "Despite continued affordability challenges and competitive market conditions, our net sales orders in the fourth quarter increased slightly from the prior year to 19,035 homes. Our sales pace aligned with typical seasonality but fell short of our expectations. While mortgage rates have declined from earlier highs this year, many potential homebuyers are anticipating lower rates in 2025. We believe rate volatility and uncertainty are resulting in some buyers hesitating."

To stimulate demand and tackle affordability issues, the company continues to offer incentives like mortgage rate buydowns and has focused on starting and selling homes with smaller floor plans.