Asset Structure Analysis
D.R. Horton’s total assets were $32.6 billion and $30.4 billion as of September 30, 2023 and September 30, 2022, respectively.
Total inventory was $22.37 billion as of September 30, 2023, accounting for 68.6% of total assets.
The size of the inventory is huge, because D.R. Horton is a real estate company.
Total cash, cash equivalents and restricted cash were $3.9 billion September 30, 2023, making up 12% of total assets.
Mortgage loans held for sale were $2.5 billion as of September 30, 2023, consisting of 7.7% of total assets.
Other assets were $3 billion as of September 30, 2023, comprising 9.2% of total assets.
Liquidity and Solvency
Total liabilities were $9.4 billion as of September 30, 2023.
The debt ratio was 28.8% for fiscal 2023.
Profitability Analysis
D.R. Horton’s revenues were $35.5 billion, $33.5 billion and $27.8 billion in the year ended September 30, 2023, the year ended September 30, 2022 and the year ended September 30, 2021, respectively.
The revenues in fiscal 2023 were up 6% year on year.
The revenues in fiscal 2022 were up 20.5% year on year.
D.R. Horton’s gross profit was 26.5%, 31.3% and 28.4% in fiscal 2023, 2022 and 2021, respectively.
Net income was $4.8 billion, $5.9 billion and $4.2 billion in fiscal 2023, 2022 and 2021, respectively.
Stockholders’ equity was $22.7 billion and $19.4 billion in fiscal 2023 and fiscal 2022, respectively.
The return on equity was 21.1% and 30.4% for fiscal 2023 and fiscal 2022, respectively.
Cash Flow Analysis
D.R. Horton’s net cash provided by operating activities was $4.3 billion, $562 million and $534 million for fiscal 2023, 2022 and 2021, respectively.
The company’s cash flow is very poor.
You can see that the company’s cash flow has been less than the amount of net income each year.
In fiscal 2022, the amount of increase in rental properties was $1.7 billion , which lead to cash outflow.
The cash flow in fiscal 2022 is undervalued, we reckon.
Repurchases of common stock were $1.18 billion, $1.13 billion and $848 million in fiscal 2023, 2022 and 2021, respectively.
Cash dividends paid were $341 million, $316.5 million and $289 million in fiscal 2023, 2022 and 2021, respectively.
D.R. Horton’s operating performance for the quarterly period ended March 31, 2024
Revenues were $16.8 billion and $15.2 billion in the six months ended March 31, 2024.
Revenues in the six months ended March 31, 2024 were up 10.5% year-on-year.
Conclusion
Debt ratio : the debt ratio is very low.
Profitability : the profitability is very high.
Cash flow : we would regard the amount of stock repurchases and cash dividends as actual return to shareholders.
We believe that D.R. Horton is a continued company, and the reasonable valuation is about $30 billion, while the company’s market capitalization is $47 billion.
Disclaimer: The content is for reference only and does not constitute investment advice.
Introduction
D.R. Horton, Inc. is the largest homebuilding company in the United States as measured by number of homes closed. We construct and sell homes through our operating divisions in 118 markets across 33 states. Our common stock is included in the S&P 500 Index and listed on the New York Stock Exchange (NYSE) under the ticker symbol “DHI.”
Our homebuilding business began in 1978 in Fort Worth, Texas, and our common stock has been publicly traded since 1992. We have expanded and diversified our homebuilding operations geographically over the years by investing capital and building teams of people in our existing markets, start-up operations in new markets and acquisitions of other homebuilding companies. We have closed more than 1,000,000 homes during our 45-year history, and we have been the largest volume homebuilder in the United States each year since 2002.
Our business operations consist of homebuilding, rental, a majority-owned residential lot development company, financial services and other activities. Our homebuilding operations are our core business, generating 90% of our consolidated revenues of $35.5 billion in fiscal 2023, 95% of consolidated revenues of $33.5 billion in fiscal 2022 and 96% of consolidated revenues of $27.8 billion in fiscal 2021. Our homebuilding operations generate most of their revenues from the sale of completed homes and to a lesser extent from the sale of land and lots. Approximately 90% of our home sales revenue in fiscal 2023 was generated from the sale of single-family detached homes, with the remainder from the sale of attached homes, such as townhomes, duplexes and triplexes. Our product offerings include a broad range of homes for entry-level, move-up, active adult and luxury buyers. Our homes generally range in size from 1,000 to 4,000 square feet and in price from $200,000 to more than $1,000,000. For the year ended September 30, 2023, our homebuilding operations closed 82,917 homes with an average closing price of $381,600.
