Key Takeaways
- D.R. Horton’s first-quarter earnings fell short of estimates on Thursday with the company cutting its full-year forecasts.
- Executives said sales in the start of the spring season have been slower than expected.
- A number of homebuilders are set to report their own results in the next two weeks.
D.R. Horton (DHI) on Thursday became the latest homebuilder to raise concerns about the housing market as it fell short of estimates.
The company cut its full-year forecasts for both revenue and homes closed as its first-quarter results missed expectations, saying that the spring selling season has “started slower than expected” amid concerns over affordability and worsening consumer confidence. (The shares rose yesterday, likely aided by an expanded buyback plan and encouraging margins.)
That could increase the focus on the next round of results due from the industry. PulteGroup (PHM), Taylor Morrison Home (TMHC), Meritage Homes (MTH), Tri Pointe Homes (TPH), Century Communities (CCS), and M/I Homes (MHO) each report next week, with NVR (NVR), LGI Homes (LGIH), and Green Brick Partners (GRBK) are due the week after.
D.R. Horton’s report echoed others that have already arrived. KB Home (KBH), Lennar (LEN) and Toll Brothers (TOL) have all said they have seen a slow housing market in the first quarter. D.R. Horton COO Michael Murray said in Thursday’s earnings call that affordability remains a “pressure point” for homebuyers, per an AlphaSense transcript.
Trump administration tariffs could hurt demand for homes and make them more expensive, analysts have said.
“I think we’re all going to have to come to the table and adjust to deliver a house that the market finds compelling and can afford,” D.R. Horton CEO Paul Romanowski said this week, adding that “we’re just going to have to see how this plays out and work with our supply partners and vendors to figure it out together.”
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