D.R. Horton’s Stock Jumps 8% On Surprise Earnings Beat

The stock of D.R. Horton (DHI) is up 8% after the largest U.S. homebuilder issued surprisingly strong quarterly financial results.

The Arlington, Texas-based company reported earnings per share (EPS) of $3.36 U.S. for what was its fiscal third quarter. That beat the $2.88 U.S profit expected among analysts.

Revenue in the period totaled $9.23 billion U.S., which was ahead of estimates that called for $8.76 billion U.S. Sales were down 7.4% from a year earlier.

Management at D.R. Horton said buyer incentives helped to sustain home sales amid high interest rates and rising costs.

Despite beating Wall Street forecasts, D.R. Horton is struggling with weak consumer spending, prompting it to offer incentives such as mortgage rate buydowns to boost demand.

The company, which is the biggest homebuilder by volume in America, said affordability constraints and cautious consumer sentiment are likely to continue in the near term.

“We expect our sales incentives to remain elevated and increase further during the fourth quarter, the extent to which will depend on the strength of demand…,” said D.R. Horton.

Looking ahead, D.R. Horton lowered its revenue forecast for this year to $33.7 billion U.S. to $34.2 billion U.S., down from an earlier forecast of $33.3 billion U.S. to $34.8 billion U.S.

The company expects to build between 85,000 and 85,500 new homes in 2025, compared with an earlier forecast of 85,000 to 87,000 houses.

Prior to today (July 22), DHI stock declined 5% on the year to trade at $131.22 U.S. per share.