For the fiscal first quarter (which ended on December 31), D.R. Horton posted revenues of $6.9 billion, down 10% from $7.6 billion a year earlier, and net income of $594.8 million, down 30% from $844.9 million. Cash from operations totaled $854.0 million. Net sales orders rose 3% year over year to 18,300 homes \u2013 a signal that demand, while squeezed by mortgage rates and cautious buyers, has not stalled.<\/p>\n
The company also returned $801.2 million to shareholders through buybacks and dividends, ending the quarter with $6.6 billion in total liquidity against $5.5 billion in notes payable.<\/p>\n
The stock peaked near $190 in mid-2024 and again near $180 in the summer of 2025 \u2013 two attempts at the same ceiling, neither of which held. The stock spent the back half of 2025 and the opening months of 2026 giving back most of those gains, falling to around $130 before the current recovery. At $140, it is still roughly 25% below those highs.<\/p>\n
Price action like that reflects a specific thesis: that the business is more vulnerable to the rate environment than its financials suggest. The Value Meter looks past that thesis and focuses directly on the numbers.<\/p>\n What it finds is worth examining.<\/p>\n D.R. Horton\u2019s enterprise value is 1.88 times its net asset value, roughly 52% below the broad market average of 3.90. A discount of that size does not reflect indifference. It reflects a market assigning a risk premium that the company\u2019s own balance sheet does not justify. Buyers at today\u2019s price are effectively acquiring $1 of assets for around $0.48.<\/p>\n The company\u2019s quarterly free cash flow relative to net asset value is 3.21%, compared with a broad market average of 1.15% \u2013 nearly 180% above average. That gap has a practical consequence: A business generating cash at that rate while priced at a steep discount is compounding its margin of safety \u2013 the difference between the intrinsic value of the business and its lower market value \u2013 quarter by quarter.<\/p>\n Furthermore, over the past three years, D.R. Horton\u2019s quarterly free cash flow has grown sequentially about 55% of the time, against a broad market average of about 46%.<\/p>\n That is not a streak of fortunate quarters. It is a result of the company\u2019s business model sustaining positive cash flow momentum across rising rates and uneven demand.<\/p>\n For an investor entering at a significant discount, that consistency matters. Even if conditions take a while to improve, the downside for the stock remains manageable.<\/p>\n One quick note: A reader named Timothy recently asked me whether The Value Meter\u2019s \u201cuniverse averages\u201d are based on industry competitors or the entire market. The answer is the latter.<\/p>\n Most analysts, for good reason, tend to compare individual companies with firms that have similar business structures, incentives, tailwinds, headwinds, etc. By doing so, they can determine a company\u2019s relative position against its peers.<\/p>\n The Value Meter, however, offers a bird\u2019s-eye view. It\u2019s telling us something broader about the market and about the stocks it analyzes. Considering the cash flows the company generates, is its acquisition cost really that worthwhile?<\/p>\n![\"Chart:](\"https:\/\/dkwegfj7whlol.cloudfront.net\/oxford\/wr\/20260403_WR_DHI_chart.jpg\")
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