A Look at Taylor Morrison Home (TMHC) Valuation as Backlog and Earnings Growth Slow

Recent analysis of Taylor Morrison Home (TMHC) points to a steady decline in the company’s backlog and an expected drop in sales over the coming year. This has created some caution about its future performance and long-term strategy.

See our latest analysis for Taylor Morrison Home.

Taylor Morrison Home’s share price has been on a bumpy ride this year, with the stock edging just 0.35% higher year-to-date and a sharp 4.99% gain in the last day. This hints at renewed short-term momentum even as longer-term total shareholder returns are down 18.77% over the past year but still up more than 100% over three years. These figures reflect both recent headwinds and prior periods of outperformance. News of industry accolades and workplace investments have coincided with weaker backlog data, so the market seems divided between cautious optimism and concern over future growth.

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With valuations near analyst targets and fundamentals signaling headwinds, the real question is whether Taylor Morrison’s recent weakness sets up a bargain or if the market is already factoring in more sluggish growth ahead.

Most Popular Narrative: 17.5% Undervalued

With Taylor Morrison Home’s fair value estimate now at $73.63, the narrative price target stands significantly above the last closing price of $60.76. The gap between price and valuation highlights a view that the stock’s upside potential may outpace recent market caution and headline risk.

The company's current backlog is down approximately 30% year-over-year and order activity (net orders) is down 12%, reflecting softening buyer demand despite favorable demographic trends. If this persists, future revenues and earnings growth could fall short of expectations, even as current deliveries are supported by high spec inventory.

Read the complete narrative.

Want to uncover the narrative logic that justified this bullish valuation despite shrinking backlogs and projected margin headwinds? Hint: Analysts built this number using surprisingly aggressive assumptions on earnings resilience, margin discipline, and future multiples. If you want to discover their underlying rationale, the full narrative reveals the numbers driving this fair value story.

Result: Fair Value of $73.63 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, ongoing input cost pressures and potential shifts in economic conditions could quickly challenge even the most optimistic outlook for Taylor Morrison Home.

Find out about the key risks to this Taylor Morrison Home narrative.

Build Your Own Taylor Morrison Home Narrative

If you think the story might look different with your own analysis, you can dig into the numbers and shape your own view in just minutes. Do it your way

A great starting point for your Taylor Morrison Home research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.

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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.

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