HOVNANIAN ENTERPRISES Reports Q1 FY2023 Earnings Results for January 31, 2023.
March 8, 2023
Earnings Overview
On February 28 2023, HOVNANIAN ENTERPRISES ($NYSE:HOV) announced its financial results for the first quarter of FY2023 ending January 31 2023. The company registered total revenue at USD 18.7 million, a decline of 24.5% compared to the same quarter in the prior year. Net income decreased 8.8% year-on-year to USD 515.4 million.
Transcripts Simplified
Hovnanian reported 132 communities open for sale in the first quarter of fiscal 2023 with plans to continue growing that number in the coming year despite delays and entitlement processes. The company is actively pursuing land parcels that meet their underwriting standards. They are using current home prices, construction costs, and sales pace to underwrite a 20+ percent internal rate of return. Hovnanian has been increasing their use of land options to increase inventory turnover and returns while reducing risk.
The percentage of lots controlled by option increased from 44% in the first quarter of fiscal 2015 to 71% in the first quarter of fiscal 2023. 60% of their lots are located in their stronger Northeast and Southeast segments, versus 40% in the West.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Hovnanian Enterprises. More…
| Total Revenues | Net Income | Net Margin |
| 2.87k | 189.02 | 7.8% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Hovnanian Enterprises. More…
| Operations | Investing | Financing |
| 89.47 | -2.15 | -16.52 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Hovnanian Enterprises. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 2.44k | 2.04k | 65.99 |
Key Ratios Snapshot
Some of the financial key ratios for Hovnanian Enterprises are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 10.5% | 64.5% | 12.2% |
| FCF Margin | ROE | ROA |
| 2.7% | 56.4% | 9.0% |
Price History
The company’s stock opened at $66.9 and closed the day at $68.1, up by 0.4% from the previous closing price of 67.8. The company’s outlook for the rest of fiscal 2023 remains optimistic, with plans to continue building upon their strong foundation of financial performance and to continue delivering value to shareholders. Live Quote…
Analysis
At GoodWhale, we recently conducted an analysis of HOVNANIAN ENTERPRISES‘s wellbeing. According to our assessment, HOVNANIAN ENTERPRISES is a medium risk investment in terms of financial and business aspects. Specifically, GoodWhale has detected two risk warnings in the income sheet and balance sheet of HOVNANIAN ENTERPRISES. We encourage you to register on goodwhale.com to find out more about our assessment and to gain access to all of our risk warning reports. With our detailed reports, you can make better informed decisions when investing in HOVNANIAN ENTERPRISES. More…
Peers
The competition between Hovnanian Enterprises Inc and its competitors, Beazer Homes USA Inc, Redrow PLC, and KB Home, is fierce. These companies are all vying for a share of the homebuilding market and must stay one step ahead of the competition to remain profitable. All four companies offer a variety of homebuilding products and services, and they are constantly innovating to bring the best products and services to consumers.
– Beazer Homes USA Inc ($NYSE:BZH)
Beazer Homes USA Inc is a homebuilding company that builds and sells single-family homes, townhomes, and condominiums across the United States. As of 2022, the company has a market cap of 408.85M and a Return on Equity of 18.97%. Beazer Homes USA Inc has a long history of success, with a strong balance sheet and extensive portfolio of properties. This strong market capitalization reflects this success, as well as the company’s ability to generate a high return on equity. The return on equity is an important metric to measure the profitability of a company, and Beazer Homes USA Inc’s strong return on equity indicates that the company is well-positioned to continue its success in the future.
– Redrow PLC ($LSE:RDW)
Redrow PLC is a major housebuilding company based in the UK, operating since 1974. With a market cap of 1.51B in 2022, the company is a leader in the industry and is well-positioned to continue its growth trajectory. The company’s Return on Equity (ROE) of 8.07% is impressive and demonstrates the strength of its business model. Redrow’s success has been driven by its commitment to quality and customer satisfaction, as well as its ability to offer attractive homes at competitive prices. The company’s ongoing success is reflected in its strong financial performance, evidenced by its impressive market cap and ROE.
– KB Home ($NYSE:KBH)
KB Home is a homebuilding company that specializes in single-family residential homes. The company has a market capitalization of 2.68 billion dollars as of 2022, which indicates that investors believe KB Home is a valuable company with good prospects for growth. Additionally, the company has an impressive Return on Equity of 18.25%, which demonstrates that it is efficiently utilizing its resources to generate profits for shareholders. This indicates that KB Home has good financial performance and is a reliable investment for shareholders.
Summary
Hovnanian Enterprises reported their first quarter financial results for their 2023 fiscal year on February 28th, showing a decrease in total revenue of 24.5% year-over-year and a 8.8% drop in net income. This could be concerning for investors, as the company is performing worse than in previous years. It is important to analyze the underlying performance of the company to determine if this is a worrying trend or if it is an anomaly. Investors should also keep an eye out for any potential future updates from the company regarding further performance and potential steps they are taking to improve their financials.
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