Shares of homebuilder D.R. Horton (NYSE:DHI) closed 10.9% higher on Thursday after the company reported fiscal third-quarter 2018 earnings that beat Wall Street's predictions by a dime.
Expected to report $1.08 per share in profit on sales of $4.3 billion, D.R. Horton instead reported earning $1.18 per share on sales of $4.4 billion.
Good as that "earnings beat" may feel, though, it doesn't come close to describing how great a quarter this was for D.R. Horton. The company sold 12% more new homes in Q3 this year than it had in last year's Q3, and charged more for them, driving sales up 13%. Operating profit margins on those sales expanded by 210 basis points to 13.9%, sending operating profits up 39%.
On the bottom line, net income increased 57% year over year.
With its fiscal year now three-quarters complete, D.R. Horton updated investors on its expectations for the balance of the year. By the time fiscal 2018 draws to a close, management expects to book sales of between $16.1 billion and $16.3 billion (up roughly 15% year over year), and to earn operating profit margins of between 12.7% and 12.9% on that revenue.
Management further predicted that it will grow sales a further 10% to 15% in fiscal 2019.