NYSE:DHI
HORTON D R INC /DE/
America's leading homebuilder delivering scalable, affordable single-family homes nationwide with a robust land development platform.
Key Metrics
Investment Thesis
Bull Case
As home prices stabilize and the inventory gap persists, D.R. Horton is well-positioned to capture market share from distressed competitors who are exiting the sector due to higher financing costs. The company's massive cash reserves and consistent ability to generate positive operating cash flow provide a safety margin to sustain dividends and return capital to shareholders even during downturns.
Bear Case
The recent decline in net income reflects broader industry headwinds where slowing demand may persist if mortgage rates remain elevated, threatening future revenue growth potential. High leverage relative to the cyclical nature of housing construction exposes the stock to significant downside volatility if a recession forces further reductions in home sales volume.
About HORTON D R INC /DE/
D.R. Horton is the largest homebuilding and land development company in the United States, serving all 50 states and Washington D.C. with a portfolio of single-family homes, townhomes, condominiums, and custom estates. The company leverages its massive scale to deliver affordable housing solutions across diverse markets while managing inventory through strategic land banking.
Analysis
Management Discussion
While revenue contracted to $34.25B in 2025 compared to the prior two years, net income decreased to $3.62B as the company navigates a shifting macroeconomic landscape. The significant cash flow from operations of $3.42B demonstrates strong underlying liquidity despite aggressive share repurchases totaling $4.30B and a notable net decrease in cash of $1.51B.
Industry Overview
The residential real estate sector is currently experiencing a correction following years of rapid price appreciation and low interest rates, creating a bifurcated environment where only top-tier builders with efficient operations can survive. Industry leaders like D.R. Horton are expected to consolidate market share as weaker players struggle with land cost inflation and rising construction expenses.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Revenue | $35.46B | $36.80B | $34.25B |
| Cost of Revenue | $26.11B | $27.27B | $26.13B |
| Gross Profit | $9.35B | $9.54B | $8.12B |
| Operating Expenses | $3.04B | $3.25B | $3.38B |
| Operating Income | $6.31B | $6.28B | $4.74B |
| G&A | $3.25B | $3.60B | $3.69B |
| Stock-Based Comp | $111.2M | $118.1M | $131.0M |
| D&A | $91.6M | $87.1M | $101.3M |
| Depreciation | $82.9M | $78.5M | $90.9M |
| Other OpEx | $-213.1M | $-348.8M | $-315.7M |
| Non-Operating Income | $0 | $0 | $0 |
| Pre-Tax Income | $6.31B | $6.28B | $4.74B |
| Income Tax | $1.52B | $1.48B | $1.12B |
| Continuing Ops | $4.80B | $4.81B | $3.62B |
| Discontinued Ops | $0 | $0 | $0 |
| Net Income | $4.80B | $4.81B | $3.62B |
| Minority Interest | $49.5M | $49.6M | $35.7M |
| Net to Common | $4.75B | $4.76B | $3.59B |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Cash & Equivalents | $3.87B | $4.52B | $2.99B |
| PP&E (Net) | $445.4M | $531.0M | $578.9M |
| Goodwill | $163.5M | $163.5M | $163.5M |
| Operating Leases | $46.6M | $51.4M | $63.0M |
| Total Assets | $32.58B | $36.10B | $35.47B |
| Total Liabilities | $9.44B | $10.28B | $10.73B |
| Shareholders' Equity | $23.14B | $25.82B | $24.74B |
| Retained Earnings | $23.59B | $27.95B | $31.04B |
| Treasury Stock | $4.33B | $6.13B | $10.43B |
| Total L&E | $32.58B | $36.10B | $35.47B |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Net Income (CFO) | $4.80B | $4.81B | $3.62B |
| Non-Cash Adjustments | $-909.9M | $-5.34B | $-1.15B |
| Working Capital Changes | $418.8M | $2.72B | $953.2M |
| Cash from Operations | $4.30B | $2.19B | $3.42B |
| Capital Expenditures | $148.6M | $165.3M | $137.4M |
| Cash from Investing | $-310.2M | $-190.6M | $-168.7M |
| Share Buybacks | $1.20B | $1.80B | $4.30B |
| Dividends Paid | $341.2M | $395.2M | $494.8M |
| Cash from Financing | $-2.67B | $-1.36B | $-4.76B |
| FX Effect | $0 | $0 | $0 |
| Net Change in Cash | $1.33B | $643.9M | $-1.51B |
| Beginning Cash | $2.57B | $3.90B | $4.54B |
| Ending Cash | $3.90B | $4.54B | $3.03B |
Frequently Asked Questions
How does HORTON D R INC /DE/ make money?
The company operates primarily through two main segments: Residential Development, which includes the sale of single-family and multifamily housing products, and Land Development, which involves the acquisition and development of raw land for future residential projects. Revenue is generated from home sales, land sales, and related services such as architectural plans and financing assistance.
What are the main risks for DHI?
The company faces high sensitivity to interest rate fluctuations which can dampen mortgage affordability and reduce homebuyer demand in a rate-sensitive environment. Local market supply constraints, including zoning regulations and permitting delays, pose execution risks that could hinder the rollout of new projects. Additionally, raw material inflation for lumber and steel remains a persistent cost pressure that impacts gross margins.
What is DHI's competitive advantage?
D.R. Horton benefits from a dominant market share that provides significant economies of scale, allowing it to negotiate favorable pricing on materials and secure large-scale land deals unavailable to smaller competitors. Its proprietary technology stack streamlines construction processes and inventory management, reducing costs and accelerating time-to-market for new developments.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.