Boston, MA 04/25/2014 (wallstreetpr) – D.R. Horton, Inc. (NYSE:DHI) announced it’s better than expected results for the second quarter of 2014 yesterday.
U.S. largest homebuilding company, by revenue, reported earnings for the second quarter of the year which surpassed analysts’ expectations. The better than expected results were on account of the rise in housing prices in the U.S.
Trailing Estimates
The Fort Worth based company reported net income, for the quarter ended march 31, of $131 million, which is equivalent to 38 cents per share. This marks a $20 million rise from the results of the same quarter a year prior, when the net income was $111 million, or equivalently 32 cents per share. According to data assimilated by Bloomberg, the reported earnings beat the average estimates of 14 analysts, which was 34 cents per share.
D.R. Horton is known for serving first time investors, but this time, the company’s focus had witnessed a shift. The homebuilders had been concentrating on a move up buyers while the company’s usual customers were caught up with tight credit. In March, new home sales in the U.S. had declined by as much as 14.5% to settle at a yearly pace of 384,000. This is the lowest recorded rate for eight months, as reported by the Commerce Department. However, the median new home costs surged by almost 12.6^ to a record high of $290,000.
Favorable Market Conditions
D.R. Horton’s Chairman said market conditions for housing remained in the company’s favorable. The rate and strength of progress depends on the local operating markets. D.R. Horton, Inc. (NYSE:DHI)’s homebuilding revenue increased to $1.7 billion in the reported quarter from the $1.39 billion the second quarter of 2013. It sold as many as 6,194 homes this year as compared to last year’s 5,643. Number of orders also increased from 7,879 to 8,569, and the average sales cost increased almost 10% to $278,900.
