Stephanie Link, Chief investment strategist, Hightower D R Horton Inc. DHI-N BUY ON WEAKNESS Feb 28, 2025

They reported last week: orders were up a lousy 1%, not 9% as expected, but gross margins expanded 50 basis points to beat expectations and added more buybacks. Trades at 12x PE.

A decade-long theme, not short term is in housing, if interest rates fall from 6.7% to 5.5% (likely in 2025). She likes DR Horton, but it's up 87% the past year, though is cheap now and gross margins are good.

Is up 25% this year. Likes it for lower interest rates, and their homes are affordable (70% of their homes cost under $400,000) during a housing shortage.

Is building a base now after a monster move higher, breaking above $200. Their uptrend is cooling down, but their Chaikin Moneyflow remains strong. After going sideways, Lang predicts this will hit $250-275 in 2025.

It rallied today, perhaps in reaction to Harris promising $25,000 to anyone buying a house if she wins. Lennar also rallied.

Is -7% this year. It's all about 30-year mortgages above 7%. 69% of their delivered homes this year were below $400,000. But it's a tough hill to climb with these high rates.

The homebuilders were in a tough spot entering this year, because of higher interest rates. Also, 13% of the construction industry consists of undocumented workers. If Trump cracks down on such workers, these will drive up labour costs and home prices.

It hit a new low. 69% of their homes cost under $400,000, so they appeal to first-time homebuyers. This is wait and see.

They reported weak numbers last Thursday, in a big top and bottom line miss. Revenue shrunk 15% with EPS -20% YOY. Shocking. They slashed full-year guidance. Are effected by a worried, cautious consumer in this economy. That said, shares actually gained last Thursday, because of a few positive numbers, like a low cancellation rate. They will buy back $4 billion of shares. Bottom line: It's dangerous to buy anything connected to housing.