D.R. Horton, Inc.
D.R. Horton, Inc. Fundamental Analysis
D.R. Horton, Inc. (DHI) shows moderate financial fundamentals with a PE ratio of 14.64, profit margin of 9.51%, and ROE of 13.24%. The company generates $33.6B in annual revenue with weak year-over-year growth of -6.93%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 55.7/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze DHI's fundamental strength across five key dimensions:
Efficiency Score
WeakDHI struggles to generate sufficient returns from assets.
Valuation Score
ExcellentDHI trades at attractive valuation levels.
Growth Score
WeakDHI faces weak or negative growth trends.
Financial Health Score
ExcellentDHI maintains a strong and stable balance sheet.
Profitability Score
WeakDHI struggles to sustain strong margins.
Key Financial Metrics
Is DHI Expensive or Cheap?
P/E Ratio
DHI trades at 14.64 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, DHI's PEG of -0.75 indicates potential undervaluation.
Price to Book
The market values D.R. Horton, Inc. at 1.97 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 10.18 times EBITDA. This signals the market has high growth expectations.
How Well Does DHI Make Money?
Net Profit Margin
For every $100 in sales, D.R. Horton, Inc. keeps $9.51 as profit after all expenses.
Operating Margin
Core operations generate 11.76 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $13.24 in profit for every $100 of shareholder equity.
ROA
D.R. Horton, Inc. generates $8.92 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
D.R. Horton, Inc. produces operating cash flow of $3.67B, showing steady but balanced cash generation.
Free Cash Flow
D.R. Horton, Inc. generates strong free cash flow of $3.52B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $12.15 in free cash annually.
FCF Yield
DHI converts 7.51% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
14.64
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-0.75
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.97
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.40
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.28
vs 25 benchmark
Current Ratio
Current assets to current liabilities
6.86
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.13
vs 25 benchmark
ROA
Return on assets percentage
0.09
vs 25 benchmark
ROCE
Return on capital employed
0.13
vs 25 benchmark
How DHI Stacks Against Its Sector Peers
| Metric | DHI Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 14.64 | 24.18 | Better (Cheaper) |
| ROE | 13.24% | 1174.00% | Weak |
| Net Margin | 9.51% | 783.00% | Weak |
| Debt/Equity | 0.28 | 0.79 | Strong (Low Leverage) |
| Current Ratio | 6.86 | 2.59 | Strong Liquidity |
| ROA | 8.92% | -8308.00% (disorted) | Weak |
DHI outperforms its industry in 3 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews D.R. Horton, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
99.79%
Industry Style: Cyclical, Growth, Discretionary
High GrowthEPS CAGR
78.95%
Industry Style: Cyclical, Growth, Discretionary
High GrowthFCF CAGR
185.10%
Industry Style: Cyclical, Growth, Discretionary
High Growth