Trade Alert for DR Horton Inc

M2 PRESSWIRE-JANUARY 24, 2007-Blue Chip News: Trade Alert for DR Horton Inc ©1994-2007 M2 COMMUNICATIONS LTD

Trade Alert for DR Horton Inc (NYSE:DHI)

When D.R. Horton heard a Who, it built the little guy a house. One of the top homebuilders in the US, following Pulte and Centex and Lennar, the company sold more than 51,000 homes in fiscal 2005. D.R. Horton mainly builds single-family homes designed for the entry-level and move-up markets. Homes range from 1,000 sq. ft. to 5,000 sq. ft., with an average selling price of about $261,000; its luxury homes can cost up to $900,000. D.R. Horton operates more than 40 divisions, building in 74 metropolitan markets in 25 states. It also provides mortgage financing and title services to homebuyers. California, Texas, Arizona, Nevada, Colorado, and Florida -- account for some 75% of inventory.

Shares were up 7% after D.R. Horton Profit Plummets.

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D.R. Horton Inc., the nation's largest homebuilder by deliveries, said Tuesday that earnings fell 64 percent in the last three months of 2006 as it wrote down the value of assets and forfeited land deposits and took fewer sales orders.

But the results still beat Wall Street's expectations, and Horton shares rose $1.74, or 6.4 percent, to $28.87 in late morning trading on the New York Stock Exchange.

Net income in the quarter ended Dec. 31 plummeted to $109.7 million, or 35 cents per share, from $310.1 million, or 98 cents per share, a year earlier.

The latest quarter included charges of $77.5 million or 15 cents per share to cover inventory write-downs and forfeited deposits on land options.

Analysts expected the company to earn 33 cents per share in the most-recent quarter, according to a survey by Thomson Financial.

Homebuilding revenue edged higher to $2.84 billion, as Fort Worth-based Horton closed on 10,202 homes, up from 9,891 last year.

Sales orders fell sharply to 8,771 homes worth $2.3 billion from 11,463 worth $3.2 billion a year earlier, a further sign that the housing market remains mired in a slump.

Horton used incentives to close on more homes than it did a year earlier. The company did not provide guidance for its new fiscal year, which began in October, but said conditions in the housing sector, which has been in a slump the past year, "remain challenging."

Backlog under contract as of Dec. 31 totaled 16,694 homes valued at $4.7 billion versus 20,816 homes valued at $6.2 billion the year before.

Horton, like many large builders, is scrambling to reduce inventory to staunch the sharp decline in prices since early 2006. The company cut its lots owned or controlled to 297,000, down 25 percent from March 2006, while homes under construction fell 35 percent to 26,000 from the June peak of 40,000.

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