D.R. Horton Inc

D.R. Horton posted a stronger-than-expected fiscal first quarter, with earnings of $2.03 per diluted share beating the $1.92 consensus estimate by 5.87% and revenue of $6.89 billion clearing the $6.65 billion forecast by 3.56%, even as both metrics reflected the weight of a housing market under pressure. The nation's largest homebuilder saw consolidated revenue fall 9.5% year over year, with the homebuilding segment bearing the brunt of the decline as elevated sales incentives, deployed to sustain order velocity amid affordability constraints and cautious consumer sentiment, compressed pre-tax homebuilding margins to 10.8% from roughly 14% a year ago. Net income dropped 30% to $594.80 million. Against that backdrop, a bullish case for the company rests on its first-time buyer exposure and the potential demand release if mortgage rates ease meaningfully. Management reiterated full-year guidance for consolidated revenues of $33.50 billion to $35.00 billion and 86,000 to 88,000 closings, while returning $801.20 million to shareholders through buybacks and dividends in the quarter alone.