D.R. Horton Guides to Fewer Home Closings in Fiscal 2027 After Fourth-Quarter Orders Fall 7%; Dividend Raised 11%

D.R. Horton, the largest U.S. homebuilder by volume, expects to close fewer homes and bring in less revenue in its 2027 fiscal year than it did in fiscal 2026, according to fourth-quarter and full-year results released on Thursday, October 29, 2026. The company issued initial guidance of $30.0 billion to $32.0 billion in consolidated revenue and 79,000 to 84,000 home closings for the year that began in October. In fiscal 2026 it closed 84,202 homes and reported consolidated revenue of $33.0 billion.

The builder said demand weakened in the quarter ended September 30. "Housing market conditions became more challenging during the fourth quarter as rising mortgage rates, affordability constraints and cautious consumer sentiment continued to pressure new home demand," Executive Chairman David Auld said in the release. He added: "We expect incentives to remain elevated in fiscal 2027, the extent of which will depend on market conditions throughout the year."

Fourth-quarter results

Net income attributable to D.R. Horton fell 18% from a year earlier to $741.8 million, and earnings per diluted share declined 12% to $2.67. Consolidated pre-tax income was $1.0 billion on revenue of $9.4 billion, a pre-tax profit margin of 10.8%. The quarter included $91.4 million of inventory impairment charges in the rental segment related to nine multifamily rental projects.

Homebuilding revenue slipped 2% to $8.4 billion, and homes closed fell 2% to 22,915. Net sales orders, an indicator of future closings, dropped 7% to 18,619 homes and 9% in value to $6.6 billion. The cancellation rate rose to 23% of gross orders from 20% a year earlier.

The rental segment reported a pre-tax loss of $25.3 million on revenue of $647.1 million, including the impairment charges. It sold 509 single-family rental homes for $134.3 million and 2,182 multifamily rental units for $512.8 million.

Full-year figures and capital returns

For fiscal 2026, net income attributable to the company fell 19% to $2.9 billion, and earnings per diluted share declined 13% to $10.11. Net sales orders for the year rose 2% to 84,995 homes. The company said about 43,500 of its buyers during the year were first-time homebuyers.

At fiscal year-end, D.R. Horton had 28,200 homes in inventory, of which 17,700 were unsold. Of the unsold homes, 8,800 were completed, including 600 that had been finished for more than six months. Cash provided by operations was $3.5 billion, total liquidity was $7.2 billion and the debt-to-total-capital ratio stood at 20.8%. The company repaid $600 million of senior notes at maturity in October and said it has no other senior note maturities in fiscal 2027.

During the year the company repurchased 24.0 million shares for $3.6 billion and paid $513.3 million in cash dividends. Its board raised the quarterly dividend 11% to $0.50 per share, payable on November 19 to shareholders of record on November 12, which the company said makes fiscal 2027 its thirteenth consecutive year of dividend growth. The fiscal 2027 outlook also calls for share repurchases of about $3.0 billion, dividend payments of about $500 million, operating cash flow of about $3.5 billion and an income tax rate of about 25.5%.

A year ago, D.R. Horton's initial fiscal 2026 guidance called for $33.5 billion to $35.0 billion in revenue and 86,000 to 88,000 closings, both above what it ultimately reported, RealtyWire noted.

Builder shares and borrowing costs

D.R. Horton shares rose to $146.53 on the day of the report from $143.00 the previous session and closed on Friday, October 30, at $146.00, according to Yahoo Finance data. From a September 30 close of $136.65, that left the stock up about 6.8% for October. The iShares U.S. Home Construction ETF ended the month at $92.74, up about 6.6% from $87.02, while PulteGroup rose about 7.5%, Lennar about 6.6% and Toll Brothers about 8.3%, based on the same data.

Those gains came as long-term borrowing costs eased. The 10-year Treasury yield, a benchmark for mortgage pricing, ended October near 4.929%, down from 5.293% at the end of September, according to Yahoo Finance. Freddie Mac's weekly survey put the average 30-year fixed mortgage rate at 7.24% as of October 29, down from 7.32% a week earlier and the lowest reading of the month, though still above the 6.17% average a year earlier. The Mortgage News Daily daily index stood at 7.27% on October 30.

Other recent housing data point to a slower market. Census Bureau figures showed new-home sales at a 676,000 annual pace in September, with the average new-home price 6.7% lower than a year earlier, and a third-quarter homeownership rate of 65.5% with a rental vacancy rate of 7.6%, according to a RealtyWire weekly housing summary. Next week brings the October jobs report and Election Day.

D.R. Horton plans to report results for the first quarter of fiscal 2027 before the market opens on Tuesday, January 19, 2027.