As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q2. Today, we are looking at home builders stocks, starting with Taylor Morrison Home (NYSE: TMHC).
Traditionally, homebuilders have built competitive advantages with economies of scale that lead to advantaged purchasing and brand recognition among consumers. Aesthetic trends have always been important in the space, but more recently, energy efficiency and conservation are driving innovation. However, these companies are still at the whim of the macro, specifically interest rates that heavily impact new and existing home sales. In fact, homebuilders are one of the most cyclical subsectors within industrials.
The 12 home builders stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 4.1%.
Luckily, home builders stocks have performed well with share prices up 16.4% on average since the latest earnings results.
Taylor Morrison Home (NYSE: TMHC)
Named “America’s Most Trusted Home Builder” in 2019, Taylor Morrison Home (NYSE: TMHC) builds single family homes and communities across the United States.
Taylor Morrison Home reported revenues of $2.03 billion, up 2% year on year. This print exceeded analysts’ expectations by 3.9%. Overall, it was a satisfactory quarter for the company with a solid beat of analysts’ adjusted operating income estimates but a significant miss of analysts’ backlog estimates.
Interestingly, the stock is up 5.7% since reporting and currently trades at $70.61.
Is now the time to buy Taylor Morrison Home? Access our full analysis of the earnings results here, it’s free.
Best Q2: Champion Homes (NYSE: SKY)
Founded in 1951, Champion Homes (NYSE: SKY) is a manufacturer of modular homes and buildings in North America.
Champion Homes reported revenues of $701.3 million, up 11.7% year on year, outperforming analysts’ expectations by 9.2%. The business had an incredible quarter with an impressive beat of analysts’ sales volume estimates and a beat of analysts’ EPS estimates.
Champion Homes achieved the fastest revenue growth among its peers. The market seems happy with the results as the stock is up 18.9% since reporting. It currently trades at $78.69.
Is now the time to buy Champion Homes? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Lennar (NYSE: LEN)
One of the largest homebuilders in America, Lennar (NYSE: LEN) is known for constructing affordable, move-up, and retirement homes across a range of markets and communities.
Lennar reported revenues of $8.38 billion, down 4.4% year on year, exceeding analysts’ expectations by 1.1%. Still, it was a softer quarter as it posted a significant miss of analysts’ adjusted operating income estimates.
Interestingly, the stock is up 26.6% since the results and currently trades at $138.55.
Read our full analysis of Lennar’s results here.
NVR (NYSE: NVR)
Known for its unique land acquisition strategy, NVR (NYSE: NVR) is a respected homebuilder and mortgage company in the United States.
NVR reported revenues of $2.60 billion, flat year on year. This print beat analysts’ expectations by 5.4%. Zooming out, it was a mixed quarter as it also logged a solid beat of analysts’ adjusted operating income estimates but a significant miss of analysts’ EBITDA estimates.
The stock is up 6.4% since reporting and currently trades at $8,408.
Read our full, actionable report on NVR here, it’s free.
LGI Homes (NASDAQ: LGIH)
Based in Texas, LGI Homes (NASDAQ: LGIH) is a homebuilding company specializing in constructing affordable, entry-level single-family homes in desirable communities across the United States.
LGI Homes reported revenues of $483.5 million, down 19.8% year on year. This result met analysts’ expectations. Taking a step back, it was a satisfactory quarter as it also recorded a solid beat of analysts’ EBITDA estimates but a significant miss of analysts’ backlog estimates.
The stock is up 20% since reporting and currently trades at $65.46.
Read our full, actionable report on LGI Homes here, it’s free.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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