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D.R. Horton (DHI) Stock Sinks As Market Gains: What You Should Know

·3 min read

D.R. Horton (DHI) closed at $72.04 in the latest trading session, marking a -0.63% move from the prior day. This change lagged the S&P 500's daily gain of 0.36%. At the same time, the Dow added 0.23%, and the tech-heavy Nasdaq lost 0.1%.

Heading into today, shares of the homebuilder had lost 3.96% over the past month, outpacing the Construction sector's loss of 11.31% and the S&P 500's loss of 6.59% in that time.

Wall Street will be looking for positivity from D.R. Horton as it approaches its next earnings report date. This is expected to be July 21, 2022. In that report, analysts expect D.R. Horton to post earnings of $4.54 per share. This would mark year-over-year growth of 48.37%. Our most recent consensus estimate is calling for quarterly revenue of $9.07 billion, up 24.45% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $17.39 per share and revenue of $35.33 billion, which would represent changes of +52.41% and +27.22%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for D.R. Horton. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.09% higher. D.R. Horton is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note D.R. Horton's current valuation metrics, including its Forward P/E ratio of 4.17. For comparison, its industry has an average Forward P/E of 3.44, which means D.R. Horton is trading at a premium to the group.

Meanwhile, DHI's PEG ratio is currently 0.5. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Building Products - Home Builders stocks are, on average, holding a PEG ratio of 0.5 based on yesterday's closing prices.

The Building Products - Home Builders industry is part of the Construction sector. This group has a Zacks Industry Rank of 155, putting it in the bottom 39% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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