D.R. Horton profit beats estimates as home sales increase

Fort Worth-based D.R. Horton reported fiscal third-quarter earnings Tuesday that beat analysts’ estimates as the company sold more homes at higher values.

Net income increased to $221.4 million, or 60 cents a share, for the three months that ended June 30, compared with $113.1 million, or 32 cents, a year earlier, the company said in a statement. The average estimate from 10 analysts was 50 cents a share, according to data compiled by Bloomberg News.

D.R. Horton has tried to attract first-time buyers with its lower-cost Express Homes brand. U.S. home sales have been rising, spurred by historically low mortgage rates and millennials entering the market. While new-home sales fell in June from May, last month marked the 12th consecutive year-over-year increase, according to Commerce Department data released last week.

D.R. Horton’s orders increased 22 percent in the quarter from a year earlier to 10,398 homes. The value of those houses rose 25 percent to $3 billion. Home-building revenue jumped 37 percent to $2.9 billion.

On a conference call, President and CEO David Auld said the company is positioned for “a good run.”

“We just see general, solid markets across the country,” he said. “Nothing is exploding, but everything seems to be getting a little better on a month-to-month basis, quarter-to-quarter basis.”

D.R. Horton’s pretax profit margin rose 330 basis points to 11.3 percent, according to the statement. The company sells houses in 27 states, including its costlier Emerald Homes.

Auld said the company believes its closings for the full year will increase by about 27 percent. With the results, shares of D.R. Horton (ticker: DHI) climbed 85 cents, or more than 3 percent, at $27.59 on the New York Stock Exchange.

This story was originally published July 28, 2015 at 9:39 AM with the headline "D.R. Horton profit beats estimates as home sales increase."