Taylor Morrison Home (TMHC) to Report Q2 Earnings: What to Expect?
Taylor Morrison Home Corporation TMHC is scheduled to report second-quarter 2023 results on Jul 26, 2023, before the opening bell.
In the last reported quarter, the company’s earnings and revenues surpassed the Zacks Consensus Estimate by 34.9% and 8.3%, respectively. Earnings increased 20.8% but revenues declined 12% from the year-ago quarter’s figures, respectively.
Notably, TMHC surpassed earnings estimates in all of the trailing four quarters, the average surprise being 17.3%.
The Trend in Estimate Revision
The Zacks Consensus Estimate for the to-be-reported quarter’s earnings has increased 2.5% to $1.66 per share over the past 30 days. The estimated figure indicates a 26.9% decline from the year-ago quarter’s earnings of $2.27 per share. The consensus mark for revenues is pegged at $1.69 billion, suggesting a decline of 15.5% from the prior-year quarter’s reported figure.
Taylor Morrison Home Corporation Price and EPS Surprise
Taylor Morrison Home Corporation price-eps-surprise | Taylor Morrison Home Corporation Quote
Factors to Note
TMHC's home closings revenues (contributed 97% to first-quarter 2023 total revenues) are expected to have declined in the second quarter from the year-ago quarter’s level due to moderate demand amid rising mortgage rates. Although the company’s home closing revenues are likely to have witnessed tough year-over-year comparisons, it is expected to generate sequentially higher home sales given the lack of existing homes for sale. The company’s innovative digital sales capabilities and other marketing initiatives are likely to help it partially offset the adverse effects of the aforementioned risks.
For the to-be-reported quarter, the Zacks Consensus Estimates for home closing revenues is pegged at $1.68 billion, down 10.8% year over year but up 4.2% sequentially.
Based on homes under construction and assuming no meaningful change in cycle times, the company expects to deliver 2,600-2,700 homes in the second quarter compared with 3032 homes delivered a year ago. The Zacks Consensus Estimate for homes closed is currently pegged at 2,675 units, suggesting a decline of 11.8% year over year, but indicating a rise of 5.3% sequentially. Also, the company anticipates ending active community count to be roughly flat in the second quarter from the first quarter of 2023. It projects the count to be between 320 and 325 for the second quarter compared with 323 units reported a year ago.
The company expects the average closing price of its homes closed to be in the range of $630,000 to $635,000 in the second quarter compared with $621,000 reported a year ago. The consensus mark for average closing price is pegged at $633,000, suggesting an increase of 1.9% year over year but down 0.3% sequentially.
Earnings of TMHC are likely to be affected by higher land, labor and material costs. Considering the mix of anticipated deliveries and the strength of its to-be-built margins, the company expects second-quarter home closing gross margin to be 23-23.5% compared with 26.6% reported a year ago.
Owing to the aforementioned economic uncertainties, the consensus mark for second-quarter 2023 total backlog is pegged at 6,515 units, calling for a 26.9% decline from the prior-year reported figure. The metric suggests an improvement of 4% from the prior quarter’s levels.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Taylor Morrison Home this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is exactly the case here.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Taylor Morrison Home has an Earnings ESP of +2.41% and carries a Zacks Rank #2.
Other Stocks With Favorable Combinations
Here are some other companies in the Zacks Construction sector that too have the right combination of elements to post an earnings beat in their respective quarters to be reported.
Louisiana-Pacific Corporation LPX has an Earnings ESP of +5.54% and a Zacks Rank #2.
LPX’s earnings missed the consensus mark once but beat the same on three other occasions, the average surprise being 98.2%. Earnings for the to-be-reported quarter are expected to plunge 84.7% year over year.
Owens Corning OC has an Earnings ESP of +2.10% and sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
OC’s earnings topped the consensus mark in all the last four quarters, the average being 15.1%. Earnings for the to-be-reported quarter are expected to decrease 13.8% year over year.
AECOM ACM has an Earnings ESP of +1.05% and a Zacks Rank #2.
ACM’s earnings topped the consensus mark in all the last four quarters, the average being 4.8%. Earnings for the to-be-reported quarter are expected to increase 10.5% year over year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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AECOM (ACM) : Free Stock Analysis Report
Louisiana-Pacific Corporation (LPX) : Free Stock Analysis Report
Owens Corning Inc (OC) : Free Stock Analysis Report
Taylor Morrison Home Corporation (TMHC) : Free Stock Analysis Report
