D.R. Horton on a Growth Path: Focus on Stability and Challenges

D.R. Horton, a leading company in the residential construction model sector, sees its strategic market positioning on track, with the majority of developed lots continuing to benefit the parent company. Katie Smith, Vice President of Finance and Investor Relations, emphasizes the goal of providing around 85% to 90% of the lots for D.R. Horton to strengthen market dominance. This proportion is expected to remain constant until coverage of about 30% of land needs is achieved. Mark Walker, COO, gives insights into the current development of cycle times for lot creation. While development typically takes about 120 days, overall cycle times have been extended due to delays in governmental approvals. However, there is a positive trend with a reduction of the times by 60 days in the last quarter and 90 days since the peak. Looking at the pipeline for 2025, Walker does not see any market saturation in affordable segments, despite demand remaining strong nationwide. CEO Anthony Oxley highlights the main growth constraint: the time required to prepare a lot from identification to development. Investment declines from a few years ago are now being revised to increase availability. Regarding land prices in potentially weaker regions such as Colorado, Texas, and Florida, Walker states that the price trend remains stable, with annual increases in the low to mid-single-digit range.