The 10-second takeaway
For the quarter ended April 30 (Q2), Hovnanian Enterprises beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly. Non-GAAP earnings per share increased. GAAP earnings per share dropped.
Gross margins dropped, operating margins increased, net margins shrank.
Hovnanian Enterprises logged revenue of $423.0 million. The eight analysts polled by S&P Capital IQ expected revenue of $416.4 million on the same basis. GAAP reported sales were 24% higher than the prior-year quarter's $341.7 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.02. The eight earnings estimates compiled by S&P Capital IQ averaged -$0.05 per share. Non-GAAP EPS were $0.02 for Q2 against -$0.14 per share for the prior-year quarter. GAAP EPS of $0.01 for Q2 were 50% lower than the prior-year quarter's $0.02 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 16.4%, 260 basis points worse than the prior-year quarter. Operating margin was 4.9%, 10 basis points better than the prior-year quarter. Net margin was 0.3%, 20 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $513.0 million. On the bottom line, the average EPS estimate is $0.07.
Next year's average estimate for revenue is $1.89 billion. The average EPS estimate is $0.09.
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 517 members out of 1,083 rating the stock outperform, and 566 members rating it underperform. Among 266 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 112 give Hovnanian Enterprises a green thumbs-up, and 154 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Hovnanian Enterprises is hold, with an average price target of $5.21.
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