In a report released yesterday, Rafe Jadrosich from Bank of America Securities reiterated a Buy rating on DR Horton (DHI – Research Report), with a price target of $168.00.
Rafe Jadrosich has given his Buy rating due to a combination of factors including D.R. Horton’s strong second-quarter earnings performance and a positive outlook for the third quarter. Specifically, the company’s earnings per share (EPS) exceeded both Bank of America Securities’ forecast and the consensus, driven by higher-than-anticipated deliveries and efficient management of selling, general, and administrative expenses (SG&A). Additionally, the company’s orders and average order selling price showed robustness, and the guidance for revenue and deliveries was raised modestly, reflecting cautious optimism.
Furthermore, despite the challenges posed by higher mortgage rates, D.R. Horton’s management has demonstrated the ability to maintain demand, as evidenced by the growth in orders both year-over-year and quarter-over-quarter. The company’s gross margin outlook remains resilient, with expectations for it to be flat to slightly up in the third quarter. Jadrosich’s recommendation also takes into account D.R. Horton’s competitive market position and strong return profile, despite a slight decrease in the price objective due to the macroeconomic headwinds and higher rates.
In another report released today, Barclays also maintained a Buy rating on the stock with a $176.00 price target.
Based on the recent corporate insider activity of 71 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of DHI in relation to earlier this year.
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DR Horton (DHI) Company Description:
Founded in 1978, Texas-based D.R. Horton, Inc. is a homebuilding company that is engaged in the construction and sale of single-family homes through its diverse brand portfolio that includes D.R. Horton, Emerald Homes, Express Homes and Freedom Homes.
