D.R. Horton, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

D.R. Horton, Inc. (NYSE:DHI) investors will be delighted, with the company turning in some strong numbers with its latest results. It was overall a positive result, with revenues beating expectations by 5.3% to hit US$9.2b. D.R. Horton reported statutory earnings per share (EPS) US$3.36, which was a notable 17% above what the analysts had forecast. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Taking into account the latest results, D.R. Horton's 15 analysts currently expect revenues in 2026 to be US$34.7b, approximately in line with the last 12 months. Statutory earnings per share are expected to reduce 7.7% to US$12.27 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$35.1b and earnings per share (EPS) of US$12.42 in 2026. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

Check out our latest analysis for D.R. Horton

With the analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 8.3% to US$157. It looks as though they previously had some doubts over whether the business would live up to their expectations. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic D.R. Horton analyst has a price target of US$187 per share, while the most pessimistic values it at US$110. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that D.R. Horton's revenue growth is expected to slow, with the forecast 0.3% annualised growth rate until the end of 2026 being well below the historical 11% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.3% per year. Factoring in the forecast slowdown in growth, it seems obvious that D.R. Horton is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple D.R. Horton analysts - going out to 2027, and you can see them free on our platform here.

You can also view our analysis of D.R. Horton's balance sheet, and whether we think D.R. Horton is carrying too much debt, for free on our platform here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.