D.R. Horton’s Growing Profits Bring in Big Money

DHI builds homes throughout the U.S., operating in 118 markets across 33 states. It focuses on single-family detached homes, which account for 90% of its sales revenue. It offers housing options from entry-level up to luxury homes while also providing mortgage financing solutions.

With interest rate cuts on the horizon, analysts have increased their earnings expectations for DHI, with per-share earnings expected to hit $14.39. In 2023, the company posted an operating margin of 17.2%, which is up from 11.6% in 2019. That jump reflects a strong ability to generate profits from revenue. Plus, DHI’s ability to grow its revenue is so strong it stands out in the industry, outpacing nearly 89.5% of its peers when it comes to revenue growth rate.

It’s no wonder DHI shares are up 18% this year – and they could rise more. MAPsignals data shows how Big Money investors are betting heavily on the forward picture of the stock.

Big Money Closes in On D.R. Horton Shares

Institutional volumes reveal plenty. Recently, DHI has enjoyed strong investor demand, which we believe to be institutional support.

Each green bar signals unusually large volumes in DHI shares. They reflect our proprietary inflow signal, pushing the stock higher:

Plenty of discretionary names are under accumulation right now. But there’s a powerful fundamental story happening with the D.R. Horton.

D.R. Horton Fundamental Analysis

Institutional support and a healthy fundamental backdrop make this company worth investigating. As you can see, DHI has had strong sales and earnings growth:

• 3-year sales growth rate (+21.1%)
• 3-year earnings growth rate (+35.2%)

Source: FactSet

Also, EPS is estimated to ramp higher this year by +8.7%.

Now it makes sense why the stock has been powering to new heights. DHI has a track record of strong financial performance.

Marrying great fundamentals with our proprietary software has found some big winning stocks over the long term.

D.R. Horton has been a top-rated stock at MAPsignals for years. That means the stock has unusual buy pressure and growing fundamentals. We have a ranking process that showcases stocks like this on a weekly basis.

It’s made the rare Top 20 report multiple times in the last decade. The blue bars below show when DHI was a top pick…with shares rising high along the way:

Tracking unusual volumes reveals the power of money flows.

This is a trait that most outlier stocks exhibit…the best of the best. Big Money demand drives stocks upward.

D.R. Horton Price Prediction

The DHI rally isn’t new at all. Big Money buying in the shares is signaling to take notice. Given the historical gains in share price and strong fundamentals, this stock could be worth a spot in a diversified portfolio.

Disclosure: the author holds no position in DHI at the time of publication.

If you are a Registered Investment Advisor (RIA) or are a serious investor, take your investing to the next level, learn more about the MAPsignals process here.