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In the last quarter, the company’s earnings and revenues beat the Zacks Consensus Estimate by 15.9% and 5.1%, respectively. However, both metrics declined 18% and 7% from the year-ago figures.
Markedly, D.R. Horton reported better-than-expected earnings in two of the trailing four quarters and missed on two occasions, the average surprise being 3.7%.
How Are Estimates Placed for D.R. Horton Stock?
The Zacks Consensus Estimate for the quarter’s earnings per share (EPS) has remained unchanged at $3.29 over the past 30 days. The estimated figure indicates a decline of 16.1% from the year-ago EPS of $3.92.
The consensus mark for revenues is $9.45 billion, indicating a 5.5% year-over-year decline.
Factors Likely to Influence DHI’s Q4 Results
Revenues
D.R. Horton’s fiscal fourth-quarter top line is likely to have decreased year over year, primarily due to the ongoing affordability challenges in the housing market. Also, lower average selling prices (ASPs) for homes delivered is an added headwind. The company anticipates the quarter’s total revenues to be between $9.1 billion and $9.6 billion compared with $10 billion reported a year ago.
DHI also anticipates a slowdown in homebuilding activity, with housing starts expected to be lower than in the fiscal third quarter. Under the Homebuilding segment (which contributed 93% of third-quarter fiscal 2025 total revenues), the revenues are expected to have declined due to a decrease in homes closed, given the still high mortgage rates circulating in the housing market. The company expects total homes closed to be between 23,500 and 24,000 units during the fiscal fourth quarter compared with 23,647 home closures made in the year-ago quarter.
Our model predicts Homebuilding revenues to decline 2.1% year over year to $8.76 billion. We also expect home closures to be 23,811 units, up 0.7% year over year. We expect Rental Property (which contributed 4.1% of total revenues in third-quarter fiscal 2025 ) revenues to be $422.2 million, which implies a 40.1% decline from the year-ago level.
On the other hand, our model predicts Forestar (which contributed 4.2% of total revenues in third-quarter fiscal 2025) revenues to be $550.5 million, which indicates a 0.2% decline from the year-ago level. We expect the Financial Services segment’s (which contributed 2.5% of total revenues in third-quarter fiscal 2025) revenues to be $213.9 million, which indicates a decline of 3.7% from the year-ago level.
Margins
A persisting inflationary environment, along with concerns for labor and material supply and elevated sales incentives aimed at sustaining demand, is expected to have pushed down the fiscal fourth-quarter margins. Management indicated that incentives will remain high and could rise further through the quarter, which is expected to have weighed on margins. The company expects the home sales gross margin to be between 21% and 21.5%, down from 23.6% reported in the year-ago quarter. Our model predicts the metric to be about 21.3%, indicating a 230 basis points (bps) year-over-year contraction.
We expect the quarter’s homebuilding SG&A, as a percentage of revenues, to be 10.5% compared with 9.6% reported a year ago.
Orders & Backlog
For the fiscal fourth quarter, our model predicts net sales orders to increase 11.6% year over year to 21,239 units. The same for backlog is currently pegged at 11,504 units, which indicates a 5.6% decrease from the 12,180 units reported a year ago. Our model predicts the value of the backlog to be $4.49 billion, implying a decline of 5.9% year over year.
What the Zacks Model Unveils for DHI
Our proven model does not conclusively predict an earnings beat for D.R. Horton this time around. The 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. That is not the case here.
Earnings ESP: DHI has an Earnings ESP of -0.91%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank of 3.
Stocks Poised to Beat Earnings
Here are some companies in the Zacks Construction sector which, according to our model, have the right combination of elements to post an earnings beat this season.
The company’s earnings beat estimates in each of the last four quarters, the average surprise being 2.8%. TopBuild’s earnings for the third quarter of 2025 are expected to decrease 8.1%.
EMCOR Group, Inc. (EME - Free Report) has an Earnings ESP of +0.20% and a Zacks Rank of 2 at present.
For the quarter to be reported, EMCOR’s earnings are expected to increase 14.7%. EMCOR’s earnings beat estimates in each of the last four quarters, the average surprise being 16.8%.
Armstrong World Industries, Inc. (AWI - Free Report) currently has an Earnings ESP of +0.63% and a Zacks Rank of 3.
The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 9.9%. Armstrong World’s earnings for the third quarter of 2025 are expected to increase 9.9%.
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Here's What Investors Must Know Ahead of D.R. Horton's Q4 Earnings
Key Takeaways
D.R. Horton Inc. (DHI - Free Report) is slated to report results for the fourth quarter of fiscal 2025 (ended Sept. 30, 2025) on Oct. 28, before the opening bell.
In the last quarter, the company’s earnings and revenues beat the Zacks Consensus Estimate by 15.9% and 5.1%, respectively. However, both metrics declined 18% and 7% from the year-ago figures.
Markedly, D.R. Horton reported better-than-expected earnings in two of the trailing four quarters and missed on two occasions, the average surprise being 3.7%.
How Are Estimates Placed for D.R. Horton Stock?
The Zacks Consensus Estimate for the quarter’s earnings per share (EPS) has remained unchanged at $3.29 over the past 30 days. The estimated figure indicates a decline of 16.1% from the year-ago EPS of $3.92.
D.R. Horton, Inc. Price and EPS Surprise
D.R. Horton, Inc. price-eps-surprise | D.R. Horton, Inc. Quote
The consensus mark for revenues is $9.45 billion, indicating a 5.5% year-over-year decline.
Factors Likely to Influence DHI’s Q4 Results
Revenues
D.R. Horton’s fiscal fourth-quarter top line is likely to have decreased year over year, primarily due to the ongoing affordability challenges in the housing market. Also, lower average selling prices (ASPs) for homes delivered is an added headwind. The company anticipates the quarter’s total revenues to be between $9.1 billion and $9.6 billion compared with $10 billion reported a year ago.
DHI also anticipates a slowdown in homebuilding activity, with housing starts expected to be lower than in the fiscal third quarter. Under the Homebuilding segment (which contributed 93% of third-quarter fiscal 2025 total revenues), the revenues are expected to have declined due to a decrease in homes closed, given the still high mortgage rates circulating in the housing market. The company expects total homes closed to be between 23,500 and 24,000 units during the fiscal fourth quarter compared with 23,647 home closures made in the year-ago quarter.
Our model predicts Homebuilding revenues to decline 2.1% year over year to $8.76 billion. We also expect home closures to be 23,811 units, up 0.7% year over year. We expect Rental Property (which contributed 4.1% of total revenues in third-quarter fiscal 2025 ) revenues to be $422.2 million, which implies a 40.1% decline from the year-ago level.
On the other hand, our model predicts Forestar (which contributed 4.2% of total revenues in third-quarter fiscal 2025) revenues to be $550.5 million, which indicates a 0.2% decline from the year-ago level. We expect the Financial Services segment’s (which contributed 2.5% of total revenues in third-quarter fiscal 2025) revenues to be $213.9 million, which indicates a decline of 3.7% from the year-ago level.
Margins
A persisting inflationary environment, along with concerns for labor and material supply and elevated sales incentives aimed at sustaining demand, is expected to have pushed down the fiscal fourth-quarter margins. Management indicated that incentives will remain high and could rise further through the quarter, which is expected to have weighed on margins. The company expects the home sales gross margin to be between 21% and 21.5%, down from 23.6% reported in the year-ago quarter. Our model predicts the metric to be about 21.3%, indicating a 230 basis points (bps) year-over-year contraction.
We expect the quarter’s homebuilding SG&A, as a percentage of revenues, to be 10.5% compared with 9.6% reported a year ago.
Orders & Backlog
For the fiscal fourth quarter, our model predicts net sales orders to increase 11.6% year over year to 21,239 units. The same for backlog is currently pegged at 11,504 units, which indicates a 5.6% decrease from the 12,180 units reported a year ago. Our model predicts the value of the backlog to be $4.49 billion, implying a decline of 5.9% year over year.
What the Zacks Model Unveils for DHI
Our proven model does not conclusively predict an earnings beat for D.R. Horton this time around. The 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. That is not the case here.
Earnings ESP: DHI has an Earnings ESP of -0.91%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank of 3.
Stocks Poised to Beat Earnings
Here are some companies in the Zacks Construction sector which, according to our model, have the right combination of elements to post an earnings beat this season.
TopBuild Corp. (BLD - Free Report) has an Earnings ESP of +1.89% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
The company’s earnings beat estimates in each of the last four quarters, the average surprise being 2.8%. TopBuild’s earnings for the third quarter of 2025 are expected to decrease 8.1%.
EMCOR Group, Inc. (EME - Free Report) has an Earnings ESP of +0.20% and a Zacks Rank of 2 at present.
For the quarter to be reported, EMCOR’s earnings are expected to increase 14.7%. EMCOR’s earnings beat estimates in each of the last four quarters, the average surprise being 16.8%.
Armstrong World Industries, Inc. (AWI - Free Report) currently has an Earnings ESP of +0.63% and a Zacks Rank of 3.
The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 9.9%. Armstrong World’s earnings for the third quarter of 2025 are expected to increase 9.9%.