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In the last reported quarter, the company’s earnings topped the Zacks Consensus Estimate by 12.9% and increased 3.2% on a year-over-year basis. Total revenues missed the Zacks Consensus Estimate by 1.9% but increased 3.3% from the year-ago quarter’s levels.
This homebuilding company’s earnings topped the consensus mark in each of the trailing eight quarters.
Trend in Estimates
For the quarter to be reported, the Zacks Consensus Estimate for earnings per share has remained unchanged at $4.94 in the past seven days. The estimated figure indicates a 4.1% decline from $5.15 per share reported in the year-ago quarter.
The consensus mark for revenues is pegged at $1.19 billion, suggesting a 2.5% drop from the year-ago quarter’s reported figure.
Factors to Note
M/I Homes’ fourth-quarter earnings and revenues are expected to decline year over year due to the moderation in housing demand, influenced by higher mortgage rates. Also, the company has been facing challenges from the material costs and wage inflation, impacting the overall affordability of the U.S. housing market.
Although the company’s homebuilding revenues are likely to have witnessed tough year-over-year comparisons, MHO is expected to generate sequentially higher revenues, given the lack of existing homes inventory. The company’s focus on single-family homes and attached townhomes for first-time, millennial, move-up, empty-nester and luxury buyers is likely to have driven growth. Also, improved construction cycle time is likely to have helped it partially offset the negative impacts of the aforementioned headwinds.
The Zacks Consensus Estimate for Homebuilding revenues of $1,186 million suggests a decline from $1,194 million reported a year ago. However, the estimated figure indicates growth from $1,023 million reported in the previous quarter.
The consensus mark for homes delivered is pegged at 2,403 units, indicating a rise from 2,384 units a year ago. The same for the average home closing price is likely to be $482,000, suggesting a fall from $492,000 reported a year ago.
The Zacks Consensus Estimate for new contracts is pegged at 1,478 homes, calling for an increase from 985 homes reported a year ago.
The Zacks Consensus Estimate for backlog is pinned at 2,507 homes, suggesting a drop from 3,137 homes reported in the prior year.
The same for Financial Services revenues is pinned at $27.8 million, suggesting a rise from the year-ago level of $22.6 million. The estimated figure indicates growth from $23.6 million reported in the previous quarter.
What the Zacks Model Says
Our proven model does not conclusively predict an earnings beat for MHO this time around. A combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. Unfortunately, that is not the case here, as you will see below.
Earnings ESP: The company has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Here are some companies in the Zacks Construction sector that, according to our model, have the right combination of elements to post an earnings beat in the quarter to be reported.
Louisiana-Pacific Corporation (LPX - Free Report) has an Earnings ESP of +6.64% and carries a Zacks Rank of #3.
LPX’s earnings for the to-be-reported quarter are expected to decline 14.8%. The company reported better-than-expected earnings in three of the last four quarters but missed on one occasion, the average surprise being 98.3%.
Floor & Decor Holdings, Inc. (FND - Free Report) has an Earnings ESP of +7.37 and carries a Zacks Rank #3.
FND’s earnings for the to-be-reported quarter are expected to decline 57.8% year over year. The company topped the consensus mark twice, met the same once and missed in the other in the trailing four quarters, the average surprise being 4.9%.
Vulcan Materials Company (VMC - Free Report) has an Earnings ESP of +1.85% and carries a Zacks Rank #3.
VMC’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, with the average being 13.6%. Earnings for the to-be-reported quarter are expected to grow 25.9% year over year.
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Factors Setting the Tone for M/I Homes' (MHO) Q4 Earnings
M/I Homes, Inc. (MHO - Free Report) is scheduled to report fourth-quarter 2023 results on Jan 31, 2024, before market open.
In the last reported quarter, the company’s earnings topped the Zacks Consensus Estimate by 12.9% and increased 3.2% on a year-over-year basis. Total revenues missed the Zacks Consensus Estimate by 1.9% but increased 3.3% from the year-ago quarter’s levels.
This homebuilding company’s earnings topped the consensus mark in each of the trailing eight quarters.
Trend in Estimates
For the quarter to be reported, the Zacks Consensus Estimate for earnings per share has remained unchanged at $4.94 in the past seven days. The estimated figure indicates a 4.1% decline from $5.15 per share reported in the year-ago quarter.
M/I Homes, Inc. Price and EPS Surprise
M/I Homes, Inc. price-eps-surprise | M/I Homes, Inc. Quote
The consensus mark for revenues is pegged at $1.19 billion, suggesting a 2.5% drop from the year-ago quarter’s reported figure.
Factors to Note
M/I Homes’ fourth-quarter earnings and revenues are expected to decline year over year due to the moderation in housing demand, influenced by higher mortgage rates. Also, the company has been facing challenges from the material costs and wage inflation, impacting the overall affordability of the U.S. housing market.
Although the company’s homebuilding revenues are likely to have witnessed tough year-over-year comparisons, MHO is expected to generate sequentially higher revenues, given the lack of existing homes inventory. The company’s focus on single-family homes and attached townhomes for first-time, millennial, move-up, empty-nester and luxury buyers is likely to have driven growth. Also, improved construction cycle time is likely to have helped it partially offset the negative impacts of the aforementioned headwinds.
The Zacks Consensus Estimate for Homebuilding revenues of $1,186 million suggests a decline from $1,194 million reported a year ago. However, the estimated figure indicates growth from $1,023 million reported in the previous quarter.
The consensus mark for homes delivered is pegged at 2,403 units, indicating a rise from 2,384 units a year ago. The same for the average home closing price is likely to be $482,000, suggesting a fall from $492,000 reported a year ago.
The Zacks Consensus Estimate for new contracts is pegged at 1,478 homes, calling for an increase from 985 homes reported a year ago.
The Zacks Consensus Estimate for backlog is pinned at 2,507 homes, suggesting a drop from 3,137 homes reported in the prior year.
The same for Financial Services revenues is pinned at $27.8 million, suggesting a rise from the year-ago level of $22.6 million. The estimated figure indicates growth from $23.6 million reported in the previous quarter.
What the Zacks Model Says
Our proven model does not conclusively predict an earnings beat for MHO this time around. A combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. Unfortunately, that is not the case here, as you will see below.
Earnings ESP: The company has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: It currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks Poised to Beat on Earnings
Here are some companies in the Zacks Construction sector that, according to our model, have the right combination of elements to post an earnings beat in the quarter to be reported.
Louisiana-Pacific Corporation (LPX - Free Report) has an Earnings ESP of +6.64% and carries a Zacks Rank of #3.
LPX’s earnings for the to-be-reported quarter are expected to decline 14.8%. The company reported better-than-expected earnings in three of the last four quarters but missed on one occasion, the average surprise being 98.3%.
Floor & Decor Holdings, Inc. (FND - Free Report) has an Earnings ESP of +7.37 and carries a Zacks Rank #3.
FND’s earnings for the to-be-reported quarter are expected to decline 57.8% year over year. The company topped the consensus mark twice, met the same once and missed in the other in the trailing four quarters, the average surprise being 4.9%.
Vulcan Materials Company (VMC - Free Report) has an Earnings ESP of +1.85% and carries a Zacks Rank #3.
VMC’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, with the average being 13.6%. Earnings for the to-be-reported quarter are expected to grow 25.9% year over year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.