D.R. Horton results miss estimates, shares drop
D.R. Horton Inc
Horton said its loss narrowed to $231.9 million, or 73 cents a share, in the fourth quarter ended September 30 from $799.9 million, or $2.53 per share, a year earlier.
Analysts on average were expecting a loss of 30 cents a share, according to Thomson Reuters I/B/E/S.
The latest results included charges of $192.6 million for losses on land values and write-offs of costs from land the company decided not to acquire.
Revenue fell 42 percent to $1.0 billion. The analysts' average estimate was $1.1 billion.
Horton shares were down 6.9 percent at $11.41 in premarket trading.
The shares fell because of the earnings miss and slightly disappointing margins, said FTN Securities analyst Joel Locker.
Revenue was light, too, so cash was much worse than expected, he added.
The company ended the quarter with $1.9 billion in cash.
Wall Street's expectations proved overly optimistic because analysts did not think Horton would get hit this quarter with such severe impairment charges, Locker said.
On the brighter side, orders rose to 5,008 homes from 3,977 last year, and the number of homes under contract increased to 5,628, from 5,297.
Most builders have reported better-than-expected order numbers this past quarter, but Horton's number was especially impressive against a flat forecast, JPMorgan analyst Michael Rehaut wrote in a client note.
Market conditions in the homebuilding industry are still challenging, characterized by rising foreclosures, high inventory levels of available homes, increasing unemployment, tight credit for homebuyers and weak consumer confidence, Chairman Donald Horton said in a statement.
(Reporting by Helen Chernikoff; additional reporting by Divya Sharma in Bangalore; editing by John Wallace)
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