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By Dhirendra Tripathi
Investing.com – DR Horton (NYSE:DHI) stock was down 3% in Thursday’s premarket trading amid increasing uncertainty on how long the housing boom will continue.
Inventories at the U.S.’ s largest homebuilder rose in the second quarter and the company said it is deliberately selling homes later in the construction cycle “when we can better ensure the certainty of the home close date for our homebuyers.”
As of the end of June, the company had 47,300 homes in inventory, of which 15,400 were unsold. Completed units out of the company’s unsold homes numbered 500.
At the same time last year, the company had 32,800 homes in inventory, of which 12,700 were unsold.
Homebuilders like DR Horton and Lennar (NYSE:LEN) have had a record year as demand for housing boomed. As the economy expanded and working from home went mainstream, people looked for permanent, bigger and more suitable housing. Low interest rates fueled demand, meanwhile.
That party may be coming to an end after housing prices hit a 30-year high.
The company’s financial year runs October to September and it now expects to close the year with consolidated revenue of $27.6 billion to $28.1 billion. It had last October guided this to come between $24 billion and $25 billion.
The company posted consolidated revenue of $20.3 billion in the last financial year.
Consolidated revenue in the third quarter rose 35% year-on-year to $7.28 billion. Adjusted profit per share was up 78% at $3.06.
Analysts had estimated EPS of $2.82 on revenue of $7.13 billion.