Salem Radio Network News Tuesday, August 3, 2021

Business

D.R. Horton slows home orders due to supply constraints

(Reuters) – D.R. Horton Inc said on Thursday a slowdown in its homebuilding driven by high lumber prices and the shortage of labor affecting the U.S. economy had forced it to take fewer orders for new homes in recent months.

With prices of homes surging across the country, Horton’s third-quarter profit and revenue beat analysts’ estimates. But the company said sales orders fell by 16.5% in the three months ended June 30.

Shares of the company fell more than 4% in premarket trading.

Permits for future home construction in the United States fell to an eight-month low in June, reflecting hesitance caused by expensive building materials as well as shortages of labor and land.

The COVID-19 pandemic, which boosted the U.S. housing market with people seeking spacious accommodation while working from home, also disrupted labor supply at saw mills and ports, causing shortages of lumber and other raw materials.

Horton expects full-year revenue between $27.6 billion and $28.1 billion, marginally above estimates of 27.35 billion, according to Refinitiv data.

It expects 2021 home sales between 83,000 units and 84,500 units, while analysts’ estimate sales of 83,475 homes.

The company’s third-quarter profit jumped 77% to $1.12 billion as it benefited from record-high property prices due to high demand. Adjusted earnings of $3.11 per share topped estimates of $2.81.

Revenue jumped 35% to $7.28 billion, above estimates of $7.19 billion.

(Reporting by Shreyasee Raj in Bengaluru; Editing by Shinjini Ganguli)

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