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D.R. Horton (DHI) Gains As Market Dips: What You Should Know

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D.R. Horton (DHI - Free Report) closed the most recent trading day at $97.76, moving +0.06% from the previous trading session. This move outpaced the S&P 500's daily loss of 1.18%. Meanwhile, the Dow lost 1.34%, and the Nasdaq, a tech-heavy index, lost 0.92%.

Prior to today's trading, shares of the homebuilder had gained 10.4% over the past month. This has outpaced the Construction sector's gain of 2.45% and the S&P 500's loss of 0.73% in that time.

D.R. Horton will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $2.83, up 32.24% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $6.89 billion, up 16.09% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $14.24 per share and revenue of $33.77 billion. These totals would mark changes of +24.8% and +21.58%, respectively, from last year.

Any recent changes to analyst estimates for D.R. Horton should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 7.13% higher. D.R. Horton is currently a Zacks Rank #3 (Hold).

Investors should also note D.R. Horton's current valuation metrics, including its Forward P/E ratio of 6.86. This valuation marks a premium compared to its industry's average Forward P/E of 6.78.

Also, we should mention that DHI has a PEG ratio of 0.68. 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. The Building Products - Home Builders industry currently had an average PEG ratio of 0.32 as of yesterday's close.

The Building Products - Home Builders industry is part of the Construction sector. This industry currently has a Zacks Industry Rank of 81, which puts it in the top 32% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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