Are You Looking To Buy D.R. Horton Inc. (DHI)? First, Read This

D.R. Horton Inc. (NYSE:DHI) trading with a subtraction of -$0.8 to $83.49 on Friday, a downside of -0.95 percent. An average of 1,762,320 shares of common stock have been traded in the last five days. There was a fall of -$0.22 in the past week. The last 20 days have seen an average of 2,569,980 shares traded, while the 50-day average volume stands at 2,385,076.

DHI stock has decreased by -7.78% in the last month. The company shares reached their 1-month lowest point of $82.30 on 10/06/21. With the stock rallying to its 52-week high on 05/10/21, shares of the company touched a low of $64.32 and a high of $106.89 in 52 weeks. In spite of this, the price is down -21.89% from the 52-week high.

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Insider Transactions

73 days have passed since D.R. Horton Inc. (DHI) last reported insider trading activity. Hewatt Michael W, who is Director, most recently acquired $2,342 shares at $92.66 per share on Jul 27. In this transaction, the insider spent $217,010. Director, BUCHANAN MICHAEL R, disposed of 2,812 shares at a price of $92.50 on Jul 26. The insider now owns more than $260,110 worth of shares. Prior to that, VP, Controller and PAO Odom Aron M. went on to Sale 3,000 shares at $102.50 each on May 07. An amount of $307,507 was transacted.

Valuation Metrics

D.R. Horton Inc. (DHI) has a trailing price-to-earnings (P/E) ratio of 8.45, which compares with the 8.80 for the broader industry and 20.40 for the sector. This means investors are optimistic about the stock’s future prospects. In the last five years, D.R. Horton Inc.’s PE ratio has ranged between 19.80 and 6.123. The stock’s beta is 1.66. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 1.16, the price-to-book (PB) ratio at 2.20, and the price-to-cash flow ratio at 68.63.

D.R. Horton Inc. pays a $0.80 dividend per share annually. It offers a dividend yield of 0.96%. The company has a payout ratio of 7.70%. The company’s most recent quarterly dividend payment took place on Aug. 17, and it was $0.20 a share, without any change from last year. Its dividend has been increased for the last 1 consecutive years with the latest increase dividend $0.0250 reported on Wednesday November 11 2020. Dividends have grown by 70.59% each year over the last three years.

D.R. Horton Inc. will next go ex-dividend on DR. The next dividend payment D.R. Horton Inc. will make is expected to be $1-Dec.

Further, the company has a long term debt to equity ratio of 0.21 and a total debt to equity ratio of 0.32 for the quarter ending June 29. On the profitability front, the trailing 12-month gross margin is 27.40% against a 5-year average of 22.5%. D.R. Horton Inc.’s EBITDA margin for the year ending June 29 is 14.94%, while its operating margin for the same period stands at 18.00%. Its gross profit as reported stood at $4.94 billion compared to revenue of $20.31 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, D.R. Horton Inc.’s return on assets was 18.00%, compared to 10.5% over the last five years. In the past year, the return on investment has been 14.80%, and the 5-year average is 12.1%. Meanwhile, the return on equity (ROE) for the past 12 months has been 28.70% and the 5-year average holds at 16.9%. For the broader industry, ROE averaged 27.45 over the past year.

Earnings Surprise

The analyst consensus anticipated D.R. Horton Inc.’s latest quarter earnings to come in at $2.81 per share, but it turned out to be $3.06, a 8.90% surprise. For the quarter, EBITDA amounted to $1.44 billion. Shareholders own equity worth $358.18 million.

Technical Picture

From a technical analysis perspective, let’s take a brief look at D.R. Horton Inc. (DHI) price momentum. RSI 9-day as of the close on 07 October was 33.57%, suggesting the stock is Neutral, with historical volatility in this time frame at 22.90%.

As of today, DHI’s price is $83.40 -0.26% or -$0.22 from its 5-day moving average. DHI is currently trading -6.76% lower than its 20-day SMA and -9.44% lower than its 100-day SMA. However, the stock’s current price level is -12.54% below the SMA50 and +15.50% above the SMA200.

The stochastic %K and %D were 17.25% and 12.83%, respectively, and the average true range (ATR) was 2.05. With the 14-day stochastic at 16.47% and the average true range at 2.13, the RSI (14) stands at 34.48%. The stock has reached -0.36 on the 9-day MACD Oscillator while the 14-day reading was at -1.64.

Analyst Ratings

Wedbush upgraded D.R. Horton Inc. (NYSE: DHI) to a an Outperform rating in its most recent analyst report. Previously, the stock was rated as a a Neutral.The consensus rating for D.R. Horton Inc. (DHI) among analysts is Overweight. According to current brokerage recommendations, 0 brokerage firms advise that investors sell DHI, while 4 suggest investors hold. There are 0 analysts who rate the stock as underweight. The stock is rated overweight by 2 analysts, while 14 others rate it as a “buy”.

What is DHI’s price target for the next 12 months?

Analysts predict a range of price targets between $97.00 and $145.00, with a median target of $110.00. Taking a look at these predictions, the average price target given by analysts for D.R. Horton Inc. (DHI) stock is $112.71.


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