D.R. Horton earnings beat estimates as sales orders increase

, Bloomberg

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D.R. Horton Inc., the largest U.S. homebuilder by volume, reported fiscal fourth-quarter earnings that beat analysts’ estimates as orders increased.

Net income rose to $100.1 million, or 30 cents a share, for the three months ended Sept. 30, compared with $35.7 million, or 11 cents, a year earlier, the Fort Worth, Texas-based company said today in a statement.

The average estimate of 20 analysts in a Bloomberg survey was for earnings of 28 cents.

“Operationally, these guys are better builders than they were coming into the crisis,” Jack Micenko, an analyst with Susquehanna International Group LLP, who has a negative rating on the company, the equivalent of a sell, said in a Nov. 9 telephone interview. “A big part of the bull case for Horton is that their margins are going to grow.”

Demand for new homes has revived as buyers, seeking to take advantage of low interest rates and prices about 30 percent below the July 2006 peak, find a tight supply of existing houses to choose.

Sales of new homes rose to an annual pace of 389,000 in September, the highest since April 2010, the Commerce Department reported on Oct. 24. Housing starts surged 15 percent in September to an annual pace of 872,000, the fastest pace since July 2008.

Net new orders totaled 5,276, with a value of $1.3 billion, compared with 4,241 homes valued at about $900 million a year earlier, D.R. Horton said.

The earnings were released before U.S. markets opened. D.R. Horton fell 1.8 percent to $20.60 on Nov. 9. The shares have risen 63 percent this year, compared with an 80 percent gain for the 11-member Standard & Poor’s 1500 Homebuilding index.
 

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