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Dream Finders Homes (DFH) Moves 13.0% Higher: Will This Strength Last?

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Dream Finders Homes Inc. (DFH - Free Report) shares ended the last trading session 13% higher at $28.7. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 5.7% gain over the past four weeks.

Shares of Dream Finders Homes appreciated after industry peers D.R. Horton and PulteGroup delivered better-than-expected earnings and revenue results. The upbeat performance from these major homebuilders lifted sentiment across the sector, driving a broad rally in homebuilding stocks.

This homebuilder is expected to post quarterly earnings of $0.65 per share in its upcoming report, which represents a year-over-year change of -19.8%. Revenues are expected to be $1.02 billion, down 3.7% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Dream Finders Homes, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on DFH going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Dream Finders Homes is part of the Zacks Building Products - Home Builders industry. Toll Brothers (TOL - Free Report) , another stock in the same industry, closed the last trading session 8.5% higher at $126.59. TOL has returned 3.7% in the past month.

Toll Brothers' consensus EPS estimate for the upcoming report has remained unchanged over the past month at $3.59. Compared to the company's year-ago EPS, this represents a change of -0.3%. Toll Brothers currently boasts a Zacks Rank of #3 (Hold).


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