D.R. Horton profit soars as housing market strengthens
(Reuters) - D.R. Horton Inc (DHI.N), the No.1 U.S. homebuilder, reported a 173 percent jump in quarterly profit and said the spring selling season was off to a strong start, sending its shares up 6 percent before the bell.
Record-low interest rates and rising rents have prompted Americans to buy homes, leading to shortage of new houses.
D.R. Horton is in a better position than competitors to meet this demand as it has a large inventory of homes built without a sales contract.
"We are in an excellent position to continue to meet increased sales demand and aggregate market share with 15,800 homes in inventory," Chairman Donald R. Horton said in a statement on Friday.
Orders rose 34 percent to 7,879 homes, with a total value of $2 billion, up from $1.3 billion a year earlier. Orders are a key indicator for builders, who do not recognize their value until they close on a home.
Net income rose to $111.0 million, or 32 cents per share, in the second quarter from $40.6 million, or 13 cents per share, a year earlier. Revenue rose 49 percent to $1.39 billion.
Analysts on average expected earnings of 19 cents per share on revenue of $1.26 billion, according to Thomson Reuters I/B/E/S.
D.R. Horton's shares have risen 52 percent in the last 12 months, slightly lagging the Dow Jones U.S. Home Construction index .DJUSHB.
The shares were up 6 percent at $25.90 before the bell on Friday.
(Reporting by Sagarika Jaisinghani in Bangalore; Editing by Roshni Menon)