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Shares of home construction company D.R. Horton (NYSE:DHI) jumped more than 7% in Thursday trading after the company topped consensus earnings and revenue expectations, while its revenue forecast also came in above estimates.
D. R. Horton reported Q2 EPS of $2.73, $0.80 better than the analyst estimate of $1.93, with revenue for the quarter coming in at $8 billion versus the consensus estimate of $6.45B.
The company’s earnings in the quarter were boosted by elevated property prices, with DHI reporting home sales revenues of $7.4B on 19,664 homes closed. Net sales orders for the second quarter decreased by 5% to 23,142 homes, representing an order value of $8.6B, which was above the $9.7B reported in the same quarter of the prior year.
“Despite higher mortgage rates and inflationary pressures, demand improved during the quarter due to normal seasonal factors, coupled with our use of incentives and pricing adjustments to adapt to changing market conditions,” said Donald R. Horton, chairman of the board.
Many have speculated that rising mortgage rates, economic uncertainty, and elevated inflation will impact the housing market. However, DHI said that although those headwinds may persist for some time, the supply of new and existing homes at affordable price points remains limited, and “demographics supporting housing demand remain favorable.”
Looking forward, the company sees 2023 revenue between $31.5B and $33B, above consensus expectations. In addition, DHI expects homes closed to be between 77,000 and 80,000.
