DR HORTON INC (DHI) Stock Fundamental Analysis
NYSE:DHI - New York Stock Exchange, Inc. - US23331A1097 - Common Stock - Currency: USD
Overall DHI gets a fundamental rating of 7 out of 10. We evaluated DHI against 67 industry peers in the Household Durables industry. Both the health and profitability get an excellent rating, making DHI a very profitable company, without any liquidiy or solvency issues. DHI has a decent growth rate and is not valued too expensively. This makes DHI very considerable for quality investing!
1. Profitability
1.1 Basic Checks
DHI had positive earnings in the past year.
In the past year DHI had a positive cash flow from operations.
Each year in the past 5 years DHI has been profitable.
DHI had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of DHI (13.29%) is better than 90.77% of its industry peers.
DHI's Return On Equity of 18.66% is fine compared to the rest of the industry. DHI outperforms 75.38% of its industry peers.
Looking at the Return On Invested Capital, with a value of 15.52%, DHI belongs to the top of the industry, outperforming 86.15% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for DHI is significantly above the industry average of 12.03%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.29% | ||
| ROE | 18.66% | ||
| ROIC | 15.52% |
ROA(3y)15.68%
ROA(5y)15.4%
ROE(3y)23.3%
ROE(5y)23.6%
ROIC(3y)18.65%
ROIC(5y)18.07%
1.3 Margins
DHI's Profit Margin of 12.69% is amongst the best of the industry. DHI outperforms 89.23% of its industry peers.
In the last couple of years the Profit Margin of DHI has grown nicely.
DHI has a better Operating Margin (16.97%) than 87.69% of its industry peers.
DHI's Operating Margin has improved in the last couple of years.
DHI has a Gross Margin of 25.89%. This is comparable to the rest of the industry: DHI outperforms 49.23% of its industry peers.
In the last couple of years the Gross Margin of DHI has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.97% | ||
| PM (TTM) | 12.69% | ||
| GM | 25.89% |
OM growth 3Y-3.96%
OM growth 5Y7.21%
PM growth 3Y-4.92%
PM growth 5Y7.03%
GM growth 3Y-2.88%
GM growth 5Y3.16%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so DHI is creating value.
The number of shares outstanding for DHI has been reduced compared to 1 year ago.
Compared to 5 years ago, DHI has less shares outstanding
The debt/assets ratio for DHI is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 6.02 indicates that DHI is not in any danger for bankruptcy at the moment.
DHI has a better Altman-Z score (6.02) than 87.69% of its industry peers.
DHI has a debt to FCF ratio of 1.78. This is a very positive value and a sign of high solvency as it would only need 1.78 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.78, DHI is in the better half of the industry, outperforming 73.85% of the companies in the same industry.
DHI has a Debt/Equity ratio of 0.20. This is a healthy value indicating a solid balance between debt and equity.
With a decent Debt to Equity ratio value of 0.20, DHI is doing good in the industry, outperforming 61.54% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.2 | ||
| Debt/FCF | 1.78 | ||
| Altman-Z | 6.02 |
ROIC/WACC1.72
WACC9.03%
2.3 Liquidity
A Current Ratio of 5.63 indicates that DHI has no problem at all paying its short term obligations.
DHI has a Current ratio of 5.63. This is in the better half of the industry: DHI outperforms 76.92% of its industry peers.
A Quick Ratio of 0.65 indicates that DHI may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.65, DHI is doing worse than 67.69% of the companies in the same industry.
The current and quick ratio evaluation for DHI is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 5.63 | ||
| Quick Ratio | 0.65 |
3. Growth
3.1 Past
DHI shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 1.80%.
The Earnings Per Share has been growing by 27.63% on average over the past years. This is a very strong growth
DHI shows a small growth in Revenue. In the last year, the Revenue has grown by 2.12%.
DHI shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 15.91% yearly.
EPS 1Y (TTM)1.8%
EPS 3Y7.75%
EPS 5Y27.63%
EPS Q2Q%-7.45%
Revenue 1Y (TTM)2.12%
Revenue growth 3Y9.84%
Revenue growth 5Y15.91%
Sales Q2Q%-1.46%
3.2 Future
The Earnings Per Share is expected to grow by 10.77% on average over the next years. This is quite good.
DHI is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.91% yearly.
EPS Next Y-9.21%
EPS Next 2Y0.5%
EPS Next 3Y5.43%
EPS Next 5Y10.77%
Revenue Next Year-0.9%
Revenue Next 2Y1.99%
Revenue Next 3Y4.04%
Revenue Next 5Y5.91%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past 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
DHI is valuated reasonably with a Price/Earnings ratio of 8.90.
DHI's Price/Earnings ratio is a bit cheaper when compared to the industry. DHI is cheaper than 67.69% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 29.63. DHI is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 8.69 indicates a reasonable valuation of DHI.
DHI's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. DHI is cheaper than 69.23% of the companies in the same industry.
DHI is valuated cheaply when we compare the Price/Forward Earnings ratio to 22.68, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.9 | ||
| Fwd PE | 8.69 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DHI indicates a somewhat cheap valuation: DHI is cheaper than 75.38% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, DHI is valued a bit cheaper than the industry average as 72.31% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.89 | ||
| EV/EBITDA | 6.62 |
4.3 Compensation for Growth
The excellent profitability rating of DHI may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.32
EPS Next 2Y0.5%
EPS Next 3Y5.43%
5. Dividend
5.1 Amount
DHI has a Yearly Dividend Yield of 1.24%.
In the last 3 months the price of DHI has falen by -22.96%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
DHI's Dividend Yield is a higher than the industry average which is at 3.05.
Compared to an average S&P500 Dividend Yield of 2.29, DHI's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.24% |
5.2 History
The dividend of DHI is nicely growing with an annual growth rate of 14.84%!
DHI has been paying a dividend for at least 10 years, so it has a reliable track record.
DHI has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)14.84%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
DHI pays out 9.11% of its income as dividend. This is a sustainable payout ratio.
The dividend of DHI is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP9.11%
EPS Next 2Y0.5%
EPS Next 3Y5.43%
125.98
-2.7 (-2.1%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryHousehold Durables
Earnings (Last)
Earnings (Next)
Inst Owners83.84%
Inst Owner Change-3%
Ins Owners0.38%
Ins Owner Change10.72%
Market Cap39.70B
Analysts69.23
Price Target176.26 (39.91%)
Short Float %2.56%
Short Ratio2.11
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.24% |
Yearly Dividend1.2
Dividend Growth(5Y)14.84%
DP9.11%
Div Incr Years10
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.39%
Min EPS beat(2)-6.87%
Max EPS beat(2)9.66%
EPS beat(4)3
Avg EPS beat(4)6.19%
Min EPS beat(4)-6.87%
Max EPS beat(4)13.72%
EPS beat(8)6
Avg EPS beat(8)14%
EPS beat(12)9
Avg EPS beat(12)12.11%
EPS beat(16)13
Avg EPS beat(16)11.96%
Revenue beat(2)1
Avg Revenue beat(2)1.69%
Min Revenue beat(2)-3.06%
Max Revenue beat(2)6.43%
Revenue beat(4)3
Avg Revenue beat(4)3.45%
Min Revenue beat(4)-3.06%
Max Revenue beat(4)9.09%
Revenue beat(8)7
Avg Revenue beat(8)6.9%
Revenue beat(12)9
Avg Revenue beat(12)5.29%
Revenue beat(16)13
Avg Revenue beat(16)4.6%
PT rev (1m)-5.8%
PT rev (3m)-9.65%
EPS NQ rev (1m)-17.81%
EPS NQ rev (3m)-24.58%
EPS NY rev (1m)-7.7%
EPS NY rev (3m)-8.39%
Revenue NQ rev (1m)-8.15%
Revenue NQ rev (3m)-14.11%
Revenue NY rev (1m)-1.48%
Revenue NY rev (3m)-1.69%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.9 | ||
| Fwd PE | 8.69 | ||
| P/S | 1.08 | ||
| P/FCF | 13.89 | ||
| P/OCF | 13.28 | ||
| P/B | 1.59 | ||
| P/tB | 1.6 | ||
| EV/EBITDA | 6.62 |
EPS(TTM)14.15
EY11.23%
EPS(NY)14.5
Fwd EY11.51%
FCF(TTM)9.07
FCFY7.2%
OCF(TTM)9.49
OCFY7.53%
SpS116.43
BVpS79.16
TBVpS78.64
PEG (NY)N/A
PEG (5Y)0.32
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.29% | ||
| ROE | 18.66% | ||
| ROCE | 20.9% | ||
| ROIC | 15.52% | ||
| ROICexc | 17.24% | ||
| ROICexgc | 19.26% | ||
| OM | 16.97% | ||
| PM (TTM) | 12.69% | ||
| GM | 25.89% | ||
| FCFM | 7.79% |
ROA(3y)15.68%
ROA(5y)15.4%
ROE(3y)23.3%
ROE(5y)23.6%
ROIC(3y)18.65%
ROIC(5y)18.07%
ROICexc(3y)21.3%
ROICexc(5y)21.07%
ROICexgc(3y)23.91%
ROICexgc(5y)23.3%
ROCE(3y)25.99%
ROCE(5y)25.32%
ROICexcg growth 3Y-8.14%
ROICexcg growth 5Y5.96%
ROICexc growth 3Y-9.18%
ROICexc growth 5Y5.08%
OM growth 3Y-3.96%
OM growth 5Y7.21%
PM growth 3Y-4.92%
PM growth 5Y7.03%
GM growth 3Y-2.88%
GM growth 5Y3.16%
F-Score4
Asset Turnover1.05
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.2 | ||
| Debt/FCF | 1.78 | ||
| Debt/EBITDA | 0.78 | ||
| Cap/Depr | 143.64% | ||
| Cap/Sales | 0.36% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 47.33% | ||
| Profit Quality | 61.43% | ||
| Current Ratio | 5.63 | ||
| Quick Ratio | 0.65 | ||
| Altman-Z | 6.02 |
F-Score4
WACC9.03%
ROIC/WACC1.72
Cap/Depr(3y)178.02%
Cap/Depr(5y)250.53%
Cap/Sales(3y)0.44%
Cap/Sales(5y)0.74%
Profit Quality(3y)45.73%
Profit Quality(5y)38.28%
High Growth Momentum
Growth
EPS 1Y (TTM)1.8%
EPS 3Y7.75%
EPS 5Y27.63%
EPS Q2Q%-7.45%
EPS Next Y-9.21%
EPS Next 2Y0.5%
EPS Next 3Y5.43%
EPS Next 5Y10.77%
Revenue 1Y (TTM)2.12%
Revenue growth 3Y9.84%
Revenue growth 5Y15.91%
Sales Q2Q%-1.46%
Revenue Next Year-0.9%
Revenue Next 2Y1.99%
Revenue Next 3Y4.04%
Revenue Next 5Y5.91%
EBIT growth 1Y-2.99%
EBIT growth 3Y5.48%
EBIT growth 5Y24.26%
EBIT Next Year-12.33%
EBIT Next 3Y1.42%
EBIT Next 5Y5.04%
FCF growth 1Y104.18%
FCF growth 3Y96.46%
FCF growth 5Y24.83%
OCF growth 1Y91.05%
OCF growth 3Y60.02%
OCF growth 5Y19.67%