NYSE$HOV

Hovnanian Enterprises Inc · Q1 2020 earnings

Q1 2020 earnings · · Investor relations

Briefing

Hovnanian Enterprises reported a strong first quarter in fiscal year 2020, marked by substantial revenue growth and improved profitability.

Hovnanian Enterprises reported a 29.8% increase in total revenues to $494.1 million for the first quarter of fiscal 2020. The company's consolidated contracts grew by 42% year-over-year, and adjusted EBITDA increased to $30.4 million. Net loss was $9.1 million, an improvement from the previous year's $17.5 million loss.

  • Total revenues increased by 29.8% to $494.1 million compared to the same period last year.
  • Consolidated contracts per community rose by 42.6% to 9.7 contracts.
  • Adjusted EBITDA increased to $30.4 million, showing improved profitability.
  • Net loss decreased to $9.1 million, an improvement from the previous year.

Headline financials

Total Revenue

$494M

Previous: $381M+29.8%
EPS (adj)

-$2.81

Previous: -$3.00+6.3%
SG&A as % of revenues

12.2%

No prior period
Consolidated communities

136

No prior period
Contracts per community

9.7

Previous: 6.8+42.6%
Cancellation rate

19.0%

Previous: 24.0%-20.8%
Total liquidity

$225M

No prior period
Homebuilding gross margin %

12.9%

No prior period
Capital Expenditures

-$809K

Previous: -$1.02M+20.6%
Free Cash Flow

$26.8M

Previous: -$123M+121.8%
Net Income

-$9.15M

Previous: -$17.5M+47.6%
Operating Income

$491M

Previous: $380M+29.2%
Gross Profit

$494M

Previous: $381M+29.8%
Cash & Equivalents

$64.4M

Previous: $128M-49.7%
Total Assets

$1.79B

Previous: $1.62B+10.2%

Revenue & EPS history

Hovnanian · Revenue · Quarterly

$494M

Q1 2020+29.8%vs Q1 2019
Beat estimate in 14 of 16 quarters(88%)
ActualEstimate

Revenue by segment

Hovnanian · $494M total across 2 segments · Q1 2020

  • Sale of homes
    $469M
  • Land sales and other
    $25.2M

Forward guidance

The company anticipates continued positive momentum in the housing market, expecting revenue gains to catch up to increases in contracts, ultimately leading to higher profitability.

Tailwinds

  • Overall U.S. economy exhibiting signs of strength.
  • Current housing market continues to show strength.
  • Positive momentum continued from the spring selling season.
  • Revenue gains are expected to catch up to increases in contracts.
  • Progress towards achieving revenue growth goals is being made.

Headwinds

  • Changes in general and local economic conditions.
  • Adverse weather and other environmental conditions.
  • High leverage and restrictions on operations due to outstanding indebtedness.
  • Availability and terms of financing to the Company.
  • Shortages in, and price fluctuations of, raw materials and labor.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 19 quarterly earnings reports · overlaid with Q1 2020

Historical avgQ1 2020

+1.0%

Avg return

Earnings day

+1.7%

Avg return

5 days after

-1.6%

Avg return

30 days after

48%

32 / 67 earnings

Positive

+53.3%

Q3 2019

Best reaction

-23.5%

Q4 2025

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q2 2026+16.6%+13.6%+34.4%
Q1 2026+3.1%-1.6%-13.1%
Q4 2025-23.5%-25.6%-27.0%
Q3 2025-11.9%-5.3%-3.4%
Q2 2025-12.6%-17.2%-16.7%
Q1 2025-12.4%-16.3%-12.5%
Q4 2024-10.5%-11.8%-31.7%
Q3 2024+10.0%+6.6%+3.5%
Q2 2024-16.3%-17.5%-16.0%
Q1 2024-12.6%-11.4%-11.1%
Q4 2023+19.6%+40.6%+49.6%
Q3 2023+18.4%+24.9%+1.3%
Q2 2023-9.3%-4.7%+5.7%
Q1 2023-1.5%+3.6%-3.8%
Q4 2022-11.9%-6.0%-7.0%
Q3 2022+2.7%-2.7%-11.0%
Q2 2022+10.5%+16.2%-9.7%
Q1 2022-4.4%-12.3%-38.5%
Q4 2021+22.6%+9.3%+4.5%
Q3 2021+10.1%+7.5%-12.2%
Q2 2021-19.3%-21.0%-26.2%
Q1 2021+48.9%+34.4%+97.5%
Q4 2020-8.2%-13.0%-16.7%
Q3 2020-14.7%-16.3%+4.8%
Q2 2020+48.7%+59.3%+26.6%
Q1 2020-13.0%-36.6%-75.9%
Q4 2019+25.6%+29.0%-2.4%
Q3 2019+53.3%+84.7%+126.9%
Q2 2019-15.2%-15.7%-18.0%
Q1 2019+7.8%+1.7%-11.5%
Q4 2018+6.4%+0.0%-29.1%
Q3 2018+3.2%+10.4%+0.0%
Q2 2018-3.0%+0.0%-13.4%
Q1 2018-6.6%-5.3%-18.0%
Q4 2017+4.9%+7.5%-4.1%
Q3 2017-7.0%-6.5%+21.0%
Q2 2017-9.6%-9.2%+11.6%
Q1 2017-9.9%-7.9%-9.5%
Q4 2016+2.5%+9.8%+11.5%
Q3 2016-15.2%-16.2%-16.2%
Q2 2016-14.0%-8.3%-11.4%
Q1 2016-16.5%
Q4 2015+7.6%
Q3 2015+2.6%
Q2 2015-8.5%
Q1 2015-0.6%
Q4 2014+10.0%
Q3 2014+1.9%
Q2 2014-2.8%
Q1 2014-14.0%
Q4 2013+7.6%
Q3 2013+0.8%
Q2 2013+2.3%
Q1 2013-2.3%
Q4 2012-3.5%
Q3 2012-1.9%
Q2 2012+22.4%
Q1 2011+16.3%
Q1 2012+16.3%
Q4 2011+9.2%
Q2 2011+9.2%
Q4 2009+9.2%
Q3 2010-12.2%
Q4 2010-12.2%
Q3 2011-12.2%
Q2 2010-13.1%
Q1 2010+2.4%

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