Housing Starts (16 April) 1.04 M (BC, prior.917 M) Housing Market Index (15 April) 42 (MC, prior 44) Construction Spending (1 April) M/M 1.2% (BC, prior M/M -2.1% S&P Case-Shiller HPI (26 March) M/M 1.0% (C, prior M/M 0.9%) New Home Sales (23 April) 417K (MC, prior 411K rev.) Economic Data Summary
Homebuilding and Financing Constructs, sells, and finances homes Domestic market Acquired Breland Homes (2012) 2011 Revenue: $130 M Q2 2013 DHI Earnings 26 April at 10:00 AM Eastern Previous Close24.69 1 Year Target Price24.00 – 26.00 52 Week Range14.37 – 25.56 Average Volume (3M) 6.02 M Market Cap.$7.06 B P/E (ttm)8.49 EPS (ttm)2.8 Dividend and Yield0.15 (0.60%) Beta1.27 Employees3,500 DHI Company Profile
Low numbers leading up to the housing crash Recovering numbers coinciding with the better housing numbers Sales, revenue, net income, etc. are all expected to rise DHI Financials
CompanyMarket Cap. P/EPrice to Book Dividend (Yield) TD/TAROAROIROEProfit Margin DHI7.72 B8.492.100.15 (.64)34.415.218.530.821.96 MDC1.77 B28.31.992.0 (2.78)22.214.171.1247.045.21 NVR4.95 B26.03.33023.28.2410.512.75.66 RYL1.90 B52.03.640.12 (.30)58.72.412.908.813.24 TOL5.70 B11.91.84036.58.6710.117.125.9 PHM7.61 B36.83.4301153.033.461015.7 KBH1.84 B5.110.14 (.46)67.3-2.32-2.5-15-3.8 LEN7.97 B12.52.320.16 (.39)48.66.747.3421.916.01 Comparison to Industry
SWOT Analysis Strengths Increase in Sales Order Backlogs Specialized Home Builders Integrated Operations Weaknesses Weak Profitability Indicators Business Concentration: the United States Opportunities Rising Demand of Senior Housing in the United States Growth Trends: Echo Boomer Population Real Estate Market Outlook: United States Threats Intense Competition Stringent Government Regulations Global Economic Scenario
We should own DHI because: Housing market still has much room to recover DHI has good financials and can capitalize on the recovery Beware of financial news indicating slowdown Investment Thesis
Sector : Industrials and Materials Industry Group: Residential Construction Current Holdings: UPS, GE, XLI, GDX, XYL, and SAND Buy 250 shares of DHI at $24.00 (approximately $6000.00, 1.09% of portfolio) Current Portfolio and Recommendation SectorTarget Allocation Current Allocation Remaining Allocation Industrials6.19%5.77%0.4% Materials2.04%3.61%-1.6%
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