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D.R. Horton (DHI) Dips More Than Broader Markets: What You Should Know

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In the latest trading session, D.R. Horton (DHI - Free Report) closed at $86.30, marking a -0.85% move from the previous day. This change lagged the S&P 500's 0.75% loss on the day.

Heading into today, shares of the homebuilder had lost 2.06% over the past month, lagging the Construction sector's loss of 1.03% and the S&P 500's gain of 2.74% in that time.

DHI will be looking to display strength as it nears its next earnings release, which is expected to be July 22, 2021. On that day, DHI is projected to report earnings of $2.83 per share, which would represent year-over-year growth of 64.53%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $7.2 billion, up 33.5% from the year-ago period.

DHI's full-year Zacks Consensus Estimates are calling for earnings of $10.47 per share and revenue of $27.4 billion. These results would represent year-over-year changes of +63.34% and +34.9%, respectively.

It is also important to note the recent changes to analyst estimates for DHI. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.6% lower. DHI currently has a Zacks Rank of #3 (Hold).

Digging into valuation, DHI currently has a Forward P/E ratio of 8.32. For comparison, its industry has an average Forward P/E of 6.72, which means DHI is trading at a premium to the group.

It is also worth noting that DHI currently has a PEG ratio of 0.92. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. DHI's industry had an average PEG ratio of 1.4 as of yesterday's close.

The Building Products - Home Builders industry is part of the Construction sector. This group has a Zacks Industry Rank of 98, putting it in the top 39% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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