DR HORTON INC (DHI) Stock Fundamental Analysis
NYSE:DHI - New York Stock Exchange, Inc. - US23331A1097 - Common Stock - Currency: USD
DHI gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 63 industry peers in the Household Durables industry. DHI gets an excellent profitability rating and is at the same time showing great financial health properties. DHI has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
DHI had positive earnings in the past year.
DHI had a positive operating cash flow in the past year.
Each year in the past 5 years DHI has been profitable.
In the past 5 years DHI always reported a positive cash flow from operatings.
1.2 Ratios
DHI's Return On Assets of 12.03% is amongst the best of the industry. DHI outperforms 87.30% of its industry peers.
DHI's Return On Equity of 17.64% is fine compared to the rest of the industry. DHI outperforms 77.78% of its industry peers.
The Return On Invested Capital of DHI (14.00%) is better than 79.37% of its industry peers.
The Average Return On Invested Capital over the past 3 years for DHI is significantly above the industry average of 10.29%.
The last Return On Invested Capital (14.00%) for DHI is well below the 3 year average (18.65%), which needs to be investigated, but indicates that DHI had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.03% | ||
| ROE | 17.64% | ||
| ROIC | 14% |
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
With an excellent Profit Margin value of 12.15%, DHI belongs to the best of the industry, outperforming 90.48% of the companies in the same industry.
DHI's Profit Margin has improved in the last couple of years.
DHI's Operating Margin of 16.33% is amongst the best of the industry. DHI outperforms 88.89% of its industry peers.
In the last couple of years the Operating Margin of DHI has grown nicely.
DHI has a Gross Margin (25.72%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of DHI has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.33% | ||
| PM (TTM) | 12.15% | ||
| GM | 25.72% |
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
DHI has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, DHI has less shares outstanding
DHI has less shares outstanding than it did 5 years ago.
The debt/assets ratio for DHI is higher compared to a year ago.
2.2 Solvency
DHI has an Altman-Z score of 5.96. This indicates that DHI is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 5.96, DHI belongs to the best of the industry, outperforming 85.71% of the companies in the same industry.
The Debt to FCF ratio of DHI is 2.39, which is a good value as it means it would take DHI, 2.39 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of DHI (2.39) is better than 74.60% of its industry peers.
A Debt/Equity ratio of 0.26 indicates that DHI is not too dependend on debt financing.
The Debt to Equity ratio of DHI (0.26) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.26 | ||
| Debt/FCF | 2.39 | ||
| Altman-Z | 5.96 |
ROIC/WACC1.59
WACC8.82%
2.3 Liquidity
A Current Ratio of 5.12 indicates that DHI has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 5.12, DHI is in the better half of the industry, outperforming 77.78% of the companies in the same industry.
DHI has a Quick Ratio of 5.12. This is a bad value and indicates that DHI is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.51, DHI is doing worse than 68.25% of the companies in the same industry.
DHI does not score too well on the current and quick ratio evaluation. However, as it has 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 | 5.12 | ||
| Quick Ratio | 0.51 |
3. Growth
3.1 Past
The earnings per share for DHI have decreased strongly by -16.25% in the last year.
Measured over the past years, DHI shows a very strong growth in Earnings Per Share. The EPS has been growing by 27.63% on average per year.
The Revenue has been growing slightly by 3.78% in the past year.
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)-16.25%
EPS 3Y7.75%
EPS 5Y27.63%
EPS Q2Q%-18.05%
Revenue 1Y (TTM)3.78%
Revenue growth 3Y9.84%
Revenue growth 5Y15.91%
Sales Q2Q%-7.43%
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 9.99% yearly.
DHI is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.46% yearly.
EPS Next Y-19.31%
EPS Next 2Y-6.13%
EPS Next 3Y2.4%
EPS Next 5Y9.99%
Revenue Next Year-8.49%
Revenue Next 2Y-2.82%
Revenue Next 3Y1.08%
Revenue Next 5Y4.46%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 11.88, the valuation of DHI can be described as very reasonable.
The rest of the industry has a similar Price/Earnings ratio as DHI.
The average S&P500 Price/Earnings ratio is at 27.69. DHI is valued rather cheaply when compared to this.
With a Price/Forward Earnings ratio of 11.71, the valuation of DHI can be described as very reasonable.
DHI's Price/Forward Earnings is on the same level as the industry average.
DHI is valuated cheaply when we compare the Price/Forward Earnings ratio to 37.36, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.88 | ||
| Fwd PE | 11.71 |
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 69.84% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.68 | ||
| EV/EBITDA | 8.49 |
4.3 Compensation for Growth
The excellent profitability rating of DHI may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.43
EPS Next 2Y-6.13%
EPS Next 3Y2.4%
5. Dividend
5.1 Amount
DHI has a Yearly Dividend Yield of 1.22%.
DHI's Dividend Yield is a higher than the industry average which is at 3.27.
Compared to an average S&P500 Dividend Yield of 2.34, DHI's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.22% |
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 its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)14.84%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
10.49% of the earnings are spent on dividend by DHI. This is a low number and sustainable payout ratio.
DHI's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP10.49%
EPS Next 2Y-6.13%
EPS Next 3Y2.4%
148.17
-5.33 (-3.47%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryHousehold Durables
Earnings (Last)
Earnings (Next)
Inst Owners84.99%
Inst Owner Change-0.18%
Ins Owners0.57%
Ins Owner Change2.99%
Market Cap45.51B
Analysts69.23
Price Target149.53 (0.92%)
Short Float %2.81%
Short Ratio2.25
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.22% |
Yearly Dividend1.2
Dividend Growth(5Y)14.84%
DP10.49%
Div Incr Years10
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)3.34%
Min EPS beat(2)-2.98%
Max EPS beat(2)9.66%
EPS beat(4)2
Avg EPS beat(4)2.01%
Min EPS beat(4)-6.87%
Max EPS beat(4)9.66%
EPS beat(8)5
Avg EPS beat(8)8.64%
EPS beat(12)8
Avg EPS beat(12)10.32%
EPS beat(16)12
Avg EPS beat(16)10.76%
Revenue beat(2)1
Avg Revenue beat(2)0.89%
Min Revenue beat(2)-4.66%
Max Revenue beat(2)6.43%
Revenue beat(4)2
Avg Revenue beat(4)0.02%
Min Revenue beat(4)-4.66%
Max Revenue beat(4)6.43%
Revenue beat(8)6
Avg Revenue beat(8)3.57%
Revenue beat(12)8
Avg Revenue beat(12)4.57%
Revenue beat(16)12
Avg Revenue beat(16)4.03%
PT rev (1m)-3.59%
PT rev (3m)-13.19%
EPS NQ rev (1m)-0.62%
EPS NQ rev (3m)-8.21%
EPS NY rev (1m)0%
EPS NY rev (3m)-6.77%
Revenue NQ rev (1m)-0.16%
Revenue NQ rev (3m)-5.74%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)-7.2%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.88 | ||
| Fwd PE | 11.71 | ||
| P/S | 1.29 | ||
| P/FCF | 16.68 | ||
| P/OCF | 15.86 | ||
| P/B | 1.87 | ||
| P/tB | 1.88 | ||
| EV/EBITDA | 8.49 |
EPS(TTM)12.47
EY8.42%
EPS(NY)12.65
Fwd EY8.54%
FCF(TTM)8.88
FCFY6%
OCF(TTM)9.34
OCFY6.31%
SpS114.97
BVpS79.19
TBVpS78.66
PEG (NY)N/A
PEG (5Y)0.43
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.03% | ||
| ROE | 17.64% | ||
| ROCE | 19.26% | ||
| ROIC | 14% | ||
| ROICexc | 15.2% | ||
| ROICexgc | 16.95% | ||
| OM | 16.33% | ||
| PM (TTM) | 12.15% | ||
| GM | 25.72% | ||
| FCFM | 7.73% |
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 Turnover0.99
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.26 | ||
| Debt/FCF | 2.39 | ||
| Debt/EBITDA | 1.09 | ||
| Cap/Depr | 149.53% | ||
| Cap/Sales | 0.4% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 48.96% | ||
| Profit Quality | 63.57% | ||
| Current Ratio | 5.12 | ||
| Quick Ratio | 0.51 | ||
| Altman-Z | 5.96 |
F-Score4
WACC8.82%
ROIC/WACC1.59
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)-16.25%
EPS 3Y7.75%
EPS 5Y27.63%
EPS Q2Q%-18.05%
EPS Next Y-19.31%
EPS Next 2Y-6.13%
EPS Next 3Y2.4%
EPS Next 5Y9.99%
Revenue 1Y (TTM)3.78%
Revenue growth 3Y9.84%
Revenue growth 5Y15.91%
Sales Q2Q%-7.43%
Revenue Next Year-8.49%
Revenue Next 2Y-2.82%
Revenue Next 3Y1.08%
Revenue Next 5Y4.46%
EBIT growth 1Y-13.91%
EBIT growth 3Y5.48%
EBIT growth 5Y24.26%
EBIT Next Year-24.69%
EBIT Next 3Y-2.94%
EBIT Next 5Y3.36%
FCF growth 1Y0.5%
FCF growth 3Y96.46%
FCF growth 5Y24.83%
OCF growth 1Y0.01%
OCF growth 3Y60.02%
OCF growth 5Y19.67%