DR HORTON INC (DHI) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:DHI - US23331A1097 - Common Stock
150 USD
-0.51 (-0.34%)
150 USD
0 (0%)
DHI gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 60 industry peers in the Household Durables industry. DHI has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. DHI is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year DHI was profitable.
- DHI had a positive operating cash flow in the past year.
- Each year in the past 5 years DHI has been profitable.
- Each year in the past 5 years DHI had a positive operating cash flow.
1.2 Ratios
- DHI has a better Return On Assets (9.63%) than 83.33% of its industry peers.
- DHI has a Return On Equity of 13.90%. This is in the better half of the industry: DHI outperforms 66.67% of its industry peers.
- DHI has a better Return On Invested Capital (11.56%) than 75.00% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for DHI is significantly above the industry average of 9.70%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.63% | ||
| ROE | 13.9% | ||
| ROIC | 11.56% |
ROA(3y)12.62%
ROA(5y)14.91%
ROE(3y)18.17%
ROE(5y)22.55%
ROIC(3y)14.99%
ROIC(5y)17.72%
1.3 Margins
- DHI's Profit Margin of 9.95% is amongst the best of the industry. DHI outperforms 83.33% of its industry peers.
- In the last couple of years the Profit Margin of DHI has declined.
- DHI has a Operating Margin of 13.57%. This is amongst the best in the industry. DHI outperforms 85.00% of its industry peers.
- In the last couple of years the Operating Margin of DHI has remained more or less at the same level.
- With a Gross Margin value of 23.61%, DHI is not doing good in the industry: 60.00% of the companies in the same industry are doing better.
- In the last couple of years the Gross Margin of DHI has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.57% | ||
| PM (TTM) | 9.95% | ||
| GM | 23.61% |
OM growth 3Y-14.91%
OM growth 5Y-0.59%
PM growth 3Y-15.74%
PM growth 5Y-2.18%
GM growth 3Y-8.68%
GM growth 5Y-0.33%
2. Health
2.1 Basic Checks
- DHI has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- DHI has less shares outstanding than it did 1 year ago.
- Compared to 5 years ago, DHI has less shares outstanding
- Compared to 1 year ago, DHI has a worse debt to assets ratio.
2.2 Solvency
- DHI has an Altman-Z score of 5.95. This indicates that DHI is financially healthy and has little risk of bankruptcy at the moment.
- DHI's Altman-Z score of 5.95 is amongst the best of the industry. DHI outperforms 83.33% of its industry peers.
- The Debt to FCF ratio of DHI is 1.60, which is an excellent value as it means it would take DHI, only 1.60 years of fcf income to pay off all of its debts.
- The Debt to FCF ratio of DHI (1.60) is better than 71.67% of its industry peers.
- DHI has a Debt/Equity ratio of 0.22. This is a healthy value indicating a solid balance between debt and equity.
- Looking at the Debt to Equity ratio, with a value of 0.22, DHI is in the better half of the industry, outperforming 63.33% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.22 | ||
| Debt/FCF | 1.6 | ||
| Altman-Z | 5.95 |
ROIC/WACC1.27
WACC9.08%
2.3 Liquidity
- DHI has a Current Ratio of 5.29. This indicates that DHI is financially healthy and has no problem in meeting its short term obligations.
- With a decent Current ratio value of 5.29, DHI is doing good in the industry, outperforming 75.00% of the companies in the same industry.
- DHI has a Quick Ratio of 5.29. This is a bad value and indicates that DHI is not financially healthy enough and could expect problems in meeting its short term obligations.
- DHI's Quick ratio of 0.55 is on the low side compared to the rest of the industry. DHI is outperformed by 71.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 5.29 | ||
| Quick Ratio | 0.55 |
3. Growth
3.1 Past
- DHI shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -22.19%.
- DHI shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 12.86% yearly.
- DHI shows a decrease in Revenue. In the last year, the revenue decreased by -8.62%.
- Measured over the past years, DHI shows a quite strong growth in Revenue. The Revenue has been growing by 11.02% on average per year.
EPS 1Y (TTM)-22.19%
EPS 3Y-11.18%
EPS 5Y12.86%
EPS Q2Q%-22.22%
Revenue 1Y (TTM)-8.62%
Revenue growth 3Y0.76%
Revenue growth 5Y11.02%
Sales Q2Q%-9.54%
3.2 Future
- DHI is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 19.04% yearly.
- DHI is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.20% yearly.
EPS Next Y-1.14%
EPS Next 2Y7.54%
EPS Next 3Y12.1%
EPS Next 5Y19.04%
Revenue Next Year-0.68%
Revenue Next 2Y2.36%
Revenue Next 3Y4.61%
Revenue Next 5Y7.2%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 13.62, which indicates a correct valuation of DHI.
- DHI's Price/Earnings ratio is in line with the industry average.
- When comparing the Price/Earnings ratio of DHI to the average of the S&P500 Index (27.25), we can say DHI is valued rather cheaply.
- With a Price/Forward Earnings ratio of 11.19, the valuation of DHI can be described as very reasonable.
- 73.33% of the companies in the same industry are more expensive than DHI, based on the Price/Forward Earnings ratio.
- When comparing the Price/Forward Earnings ratio of DHI to the average of the S&P500 Index (25.98), we can say DHI is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.62 | ||
| Fwd PE | 11.19 |
4.2 Price Multiples
- DHI's Enterprise Value to EBITDA is on the same level as the industry average.
- DHI's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. DHI is cheaper than 73.33% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.6 | ||
| EV/EBITDA | 9.92 |
4.3 Compensation for Growth
- DHI has a very decent profitability rating, which may justify a higher PE ratio.
- A more expensive valuation may be justified as DHI's earnings are expected to grow with 12.10% in the coming years.
PEG (NY)N/A
PEG (5Y)1.06
EPS Next 2Y7.54%
EPS Next 3Y12.1%
5. Dividend
5.1 Amount
- DHI has a Yearly Dividend Yield of 1.20%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 1.17, DHI pays a bit more dividend than its industry peers.
- DHI's Dividend Yield is slightly below the S&P500 average, which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.2% |
5.2 History
- The dividend of DHI is nicely growing with an annual growth rate of 18.00%!
- DHI has paid a dividend for at least 10 years, which is a reliable track record.
- DHI has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)18%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
- DHI pays out 14.93% of its income as dividend. This is a sustainable payout ratio.
- The dividend of DHI is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP14.93%
EPS Next 2Y7.54%
EPS Next 3Y12.1%
DR HORTON INC / DHI FAQ
What is the fundamental rating for DHI stock?
ChartMill assigns a fundamental rating of 6 / 10 to DHI.
Can you provide the valuation status for DR HORTON INC?
ChartMill assigns a valuation rating of 5 / 10 to DR HORTON INC (DHI). This can be considered as Fairly Valued.
Can you provide the profitability details for DR HORTON INC?
DR HORTON INC (DHI) has a profitability rating of 7 / 10.
What is the valuation of DR HORTON INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for DR HORTON INC (DHI) is 13.62 and the Price/Book (PB) ratio is 1.83.
What is the earnings growth outlook for DR HORTON INC?
The Earnings per Share (EPS) of DR HORTON INC (DHI) is expected to decline by -1.14% in the next year.