Rochester, NY 8/20/2009 9:31:07 AM
News / Business

D.R. Horton, Inc., DHI - D.R. Horton Net Profit Set to Plunge

D.R. Horton, Inc.

Based on the aggregated intelligence of 135, advantage investors participate in Motley Fool free investing community, homebuilder D.R. Horton has acknowledged the dreaded one-star ranking  With that in mind, let's take a closer look at D.R. Horton business and see what CAPS investors are saying about the stock right now.

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Overall, loans are still hard for customers to acquire, inventory value is dropping, and consumers continue to receive bankruptcy letters. In some cases, some equities became undervalued in the March 9th sell off, but by my metrics most home builders are now nearly 2X above their real value. It will take years for them to recover to profitability. Some will be able to acquire assets very cheaply and recover sooner, but well behind the rest of the market. D.R. Horton with a negative 25% margin and a negative 36% gets my red thumb for now. Its dependency on internal loan sourcing and reselling the loans places it in a risky position.

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