D.R. Horton Profit Soars

Home builder D.R. Horton Inc. on Tuesday said profit in its latest quarter nearly doubled, as orders and closings jumped.

Rising consumer confidence, low mortgage rates and low inventory have helped spur new-home sales over recent months. The Federal Reserve's policy-setting committee in its latest assessment signaled a more optimistic shift in its view of the housing market, and the annual sales pace hit a seven-year high in the most recent report from the U.S. Census Bureau.

For D.R. Horton, orders grew 22% in its fiscal third quarter to 10,398 homes, though the increase fell short of the 10,785 analysts polled by FactSet predicted. The value of new orders rose 25% to $3 billion while backlog totaled $3.7 billion, up 15% from a year earlier. Closings, meanwhile, climbed 28% to 9,856 homes.

In all for the June quarter, the Fort Worth, Texas, company reported a profit of $221.4 million, or 60 cents a share, up from $113.1 million, or 32 cents, a year earlier. Revenue rose 37% to $2.88 billion.

Analysts expected earnings of 50 cents a share on $2.76 billion in sales, according to FactSet.

Home-building gross margin narrowed to 19.9% from 20.3%.

Smaller rival PulteGroup Inc. last week also said order growth spurred an increase in second-quarter profit.

D.R. Horton shares, up about 6% this year, rose 1.4% to $27.10 in premarket trading.

Write to Lisa Beilfuss at [e-mail]

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