for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up
Markets News

UPDATE 2-D.R. Horton beats quarterly profit, sees 2021 sales above estimates

(Adds shares, home sales, background)

Nov 10 (Reuters) - D.R. Horton Inc on Tuesday reported a better-than-expected quarterly profit and forecast 2021 home sales above estimates on record low mortgage rates, while warning of risks to the market from coronavirus infections and restrictions.

The company’s shares, which have jumped 23% this year, rose 2.8% in premarket trade, as D.R. Horton reported a jump in both fourth-quarter profit and sales from a year earlier, fueled by the housing market outperforming much of the U.S. economy.

The National Association of Realtors last month said U.S. existing home sales surged in September to levels not seen in more than 14 years, with wealthier buyers seeking to move out of cities as the COVID-19 pandemic fuels demand for upscale housing.

D.R. Horton said it expects home sales in fiscal year 2021 to be between 77,000 and 80,000 units, compared with analysts’ average estimate of 75,981, according to IBES data from Refinitiv.

It also declared a quarterly cash dividend of $0.20 per share, a 14% jump compared to its last payout, as net income attributable to the company rose to $829 million, or $2.24 per share, in the quarter from $505.3 million, or $1.35 per share, a year earlier. Home sales rose 26% to 20,248 units.

Analysts on average had expected a profit of $1.76 per share.

The company, however, also warned of the impact of the pandemic on underlying demand.

Analysts say rises in home values have priced some buyers out of the market and warn that there are also an estimated 3 million households covered by COVID-19 mortgage forbearance at risk of losing their homes next spring.

“There is significant uncertainty regarding the extent to which and how long COVID-19 and its related effects will impact the U.S. economy,” Horton warned in its statement. (Reporting by Shreyasee Raj; Editing by Shinjini Ganguli)

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up