NYSE$HOV

Hovnanian Enterprises Inc · Q3 2022 earnings

Q3 2022 earnings · · Investor relations

Briefing

Hovnanian reported an increase in revenue and pretax profit for Q3 2022.

Hovnanian Enterprises reported an 11.1% increase in total revenues to $767.6 million for the third quarter of fiscal 2022, compared to $690.7 million in the same quarter of the prior year. Income before income taxes increased by 81.1% to $111.9 million. Net income was $82.6 million, or $10.82 per diluted common share, compared to $47.7 million, or $6.72 per diluted common share, in the third quarter of the previous fiscal year.

  • Total revenues increased 11.1% year-over-year to $767.6 million.
  • Homebuilding gross margin percentage increased 390 basis points year-over-year to 23.1%.
  • Income before income taxes increased 81.1% year-over-year to $111.9 million.
  • Net income increased to $82.6 million, or $10.82 per diluted common share.

Headline financials

Total Revenue

$768M

Previous: $691M+11.1%
EPS (adj)

$10.82

Previous: $6.72+61.0%
Homebuilding gross margin %

23.1%

No prior period
Capital Expenditures

-$8.61M

Previous: -$3.89M-121.3%
Free Cash Flow

-$37.2M

Previous: $78.4M-147.5%
Net Income

$82.6M

Previous: $47.7M+73.2%
Operating Income

$761M

Previous: $683M+11.5%
Gross Profit

$768M

Previous: $691M+11.1%
Cash & Equivalents

$13.7M

Previous: $17.9M-23.5%
Total Assets

$2.54B

Previous: $2.31B+9.8%
Stock-Based Comp

$3.01M

Previous: $3.56M-15.4%

Revenue & EPS history

Hovnanian · Revenue · Quarterly

$768M

Q3 2022+11.1%vs Q3 2021
Beat estimate in 6 of 7 quarters(86%)
ActualEstimate

Revenue by segment

Hovnanian · $768M total across 3 segments · Q3 2022

  • Sale of homes
    $737M
  • Land sales and other
    $30.9M
  • Financial services
    $300K-98.6%

Forward guidance

The Company is increasing its gross margin, EBITDA and pretax profit guidance for the full year of fiscal 2022.

Tailwinds

  • Total revenues are expected to be between $2.80 billion and $3.00 billion.
  • Gross margin, before cost of sales interest expense and land charges, is expected to be between 24.0% and 26.0%.
  • Adjusted pretax income is expected to be between $310 million and $325 million.
  • Adjusted EBITDA is expected to be between $460 million and $475 million.
  • Fully diluted earnings per share is expected to be between $32.00 and $33.50.

Headwinds

  • Financial guidance assumes no adverse changes in current market conditions, including further deterioration in the supply chain.
  • Guidance assumes no material increase in mortgage rates.
  • Guidance excludes increased inflation.
  • Guidance excludes further impact to SG&A expenses from phantom stock expense related solely to stock price movements from the closing price of $48.51 at July 29, 2022.
  • Anticipate reducing senior secured notes by an additional $100 million during the fourth quarter of fiscal 2022.

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 Q3 2022

Historical avgQ3 2022

+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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