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D.R. Horton (DHI) delivered a solid 1Q26 beat with earnings and revenue that topped analyst estimates, as the stock exhibits notable relative strength following disappointing results from peers Lennar (LEN) and Toll Brothers (TOL) in December. The company’s reiterated FY26 guidance, projecting consolidated revenues of $33.5 to $35.0 bln, reflects a resilient demand environment bolstered by a recent downturn in mortgage rates.

• EPS of $2.03 exceeded the consensus estimate of $1.93, driven by effective cost management and operational efficiency. Consolidated revenues rose to $6.9 bln, surpassing the expected $6.59 bln despite broader market affordability constraints.
• Home sales revenues of $6.5 bln were generated from 17,818 homes closed, representing an average sales price of approximately $365,000.
• Net sales orders increased 3% yr/yr to 18,300 homes, signaling a positive demand trend entering the spring selling season.
• FY26 closings are projected at 86,0008-8,000 homes, as the company maintains its leadership position through affordable product offerings and a flexible lot supply.
• Mortgage rates dipped below 6% following President Trump’s directive for Fannie Mae and Freddie Mac to purchase $200 bln in mortgage-backed securities (MBS), sparking a 28.5% jump in weekly mortgage applications.
• Shareholder returns remain a priority, with the company aiming for at least $3.0 bln in operating cash flow to support $2.5 bln in share repurchases and $500 mln in dividends for FY26.

Briefing.com Analyst Insight:

DHI's 1Q26 performance stands in stark contrast to the margin-pinched results seen from LEN and TOL last month, suggesting that DHI's scale and focus on the entry-level market are providing a competitive moat. The Trump administration's MBS buying directive has provided a critical tailwind, pushing rates under the psychological 6% barrier and effectively neutralizing some of the "cautious consumer sentiment" that weighed on results in late 2025. While LEN's stock struggled with an EPS miss and soft guidance in December, DHI's ability to maintain its full-year outlook despite high incentive levels demonstrates superior execution. However, the long-term impact of the MBS directive remains a variable; if inflation picks up and counteracts the spread compression, DHI's reliance on rate-sensitive first-time buyers could once again become a point of vulnerability. For now, the "America’s Builder" narrative remains intact as DHI navigates a complex macro landscape with significant relative strength.