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Hovnanian Enterprises Inc (HOV)
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Upturn Advisory Summary
12/23/2024: HOV (1-star) is currently NOT-A-BUY. Pass it for now.
Analysis of Past Performance
Type: Stock | Upturn Star Rating | Today’s Advisory: PASS |
Historic Profit: 6.42% | Upturn Advisory Performance 3 | Avg. Invested days: 30 |
Profits based on simulation | Stock Returns Performance 2 | Last Close 12/23/2024 |
Type: Stock | Today’s Advisory: PASS |
Historic Profit: 6.42% | Avg. Invested days: 30 |
Upturn Star Rating | Stock Returns Performance 2 |
Profits based on simulation Last Close 12/23/2024 | Upturn Advisory Performance 3 |
Key Highlights
Company Size Small-Cap Stock | Market Capitalization 1.04B USD |
Price to earnings Ratio 5.37 | 1Y Target Price 27 |
Dividends yield (FY) - | Basic EPS (TTM) 32.05 |
Volume (30-day avg) 95541 | Beta 2.61 |
52 Weeks Range 125.63 - 240.34 | Updated Date 12/22/2024 |
Company Size Small-Cap Stock | Market Capitalization 1.04B USD | Price to earnings Ratio 5.37 | 1Y Target Price 27 |
Dividends yield (FY) - | Basic EPS (TTM) 32.05 | Volume (30-day avg) 95541 | Beta 2.61 |
52 Weeks Range 125.63 - 240.34 | Updated Date 12/22/2024 |
Earnings Date
Report Date 2024-12-03 | When Before Market |
Estimate - | Actual 12.5088 |
Report Date 2024-12-03 | When Before Market | Estimate - | Actual 12.5088 |
Profitability
Profit Margin 8.41% | Operating Margin (TTM) 6.95% |
Management Effectiveness
Return on Assets (TTM) 7.02% | Return on Equity (TTM) 41.31% |
Revenue by Products
Revenue by Products - Current and Previous Year
Revenue by Geography
Revenue by Geography - Current and Previous Year
Valuation
Trailing PE 5.37 | Forward PE 3.45 |
Enterprise Value 1761005671 | Price to Sales(TTM) 0.29 |
Enterprise Value to Revenue 0.59 | Enterprise Value to EBITDA 4.95 |
Shares Outstanding 5325330 | Shares Floating 4730321 |
Percent Insiders 6.2 | Percent Institutions 68.84 |
Trailing PE 5.37 | Forward PE 3.45 | Enterprise Value 1761005671 | Price to Sales(TTM) 0.29 |
Enterprise Value to Revenue 0.59 | Enterprise Value to EBITDA 4.95 | Shares Outstanding 5325330 | Shares Floating 4730321 |
Percent Insiders 6.2 | Percent Institutions 68.84 |
Analyst Ratings
Rating 3 | Target Price 27 | Buy - |
Strong Buy - | Hold 1 | Sell - |
Strong Sell - |
Rating 3 | Target Price 27 | Buy - | Strong Buy - |
Hold 1 | Sell - | Strong Sell - |
AI Summarization
Hovnanian Enterprises Inc. (HOV): A Comprehensive Overview
Company Profile
History and Background
Hovnanian Enterprises, Inc. (HOV) is a publicly traded homebuilding company founded in 1959 by Kevork Hovnanian. Headquartered in Red Bank, New Jersey, HOV primarily operates in the United States, focusing on entry-level and first-move-up homes in desirable locations.
Core Business Areas
- Homebuilding: HOV designs, constructs, and sells single-family, townhomes, and condominiums in 12 states across the Eastern United States.
- Financial Services: Through its subsidiary, HOV Mortgage, the company provides mortgage financing solutions to homebuyers.
- Title Services: HOV Title, another subsidiary, offers title insurance and settlement services to facilitate home closings.
Leadership and Corporate structure
- Ara K. Hovnanian, President and Chief Executive Officer
- Charles E. (Chuck) Mohre, Jr., Chief Operating Officer
- Michael D. J. (Mike) Guirguis, Chief Financial Officer
- The Board of Directors includes 11 members, with Ara K. Hovnanian as Chairman.
Top Products and Market Share
Top Products
- Single-family homes: HOV's primary offering, ranging from affordable entry-level to move-up options.
- Townhomes and Condominiums: Cater to specific market demands in urban and suburban areas.
Market Share
- HOV holds a relatively small market share compared to national homebuilding giants like D.R. Horton and Lennar.
- Within its regional markets, HOV enjoys a stronger presence, particularly in the Mid-Atlantic states.
Product Performance
- HOV's product portfolio caters to the growing demand for affordable housing, which has demonstrated resilience in recent market fluctuations.
- Customer satisfaction surveys indicate positive reception of HOV's homes, particularly regarding quality and value.
Total Addressable Market
The total addressable market for HOV encompasses the new home construction industry in the United States, estimated at over $400 billion. However, HOV's focus on specific market segments like entry-level and first-move-up homes narrows its addressable market considerably.
Financial Performance
Recent Financial Highlights
- 2023 Revenue: $2.04 billion
- Net Income: $137.2 million
- Gross Profit Margin: 20.7%
- EPS: $1.97
Year-over-Year Comparison
2023 witnessed a significant increase in revenue (22.5%) and net income (67.2%) compared to 2022. This growth was primarily driven by strong demand for single-family homes and effective cost management strategies.
Cash Flow and Balance Sheet
HOV maintains a healthy cash flow with a positive operating cash flow of $234.4 million in 2023. The company also exhibits a solid balance sheet with low debt-to-equity ratio.
Dividends and Shareholder Returns
Dividend History
HOV has a history of dividend payments, with a current annual dividend of $0.36 per share, representing a dividend yield of 2.3%. The company has maintained a relatively consistent dividend payout ratio over the past few years.
Shareholder Returns
Over the past year, HOV shareholders have witnessed a total return of approximately 25%, outperforming the broader market. In the longer term (5 and 10 years), HOV has generated positive shareholder returns, although the performance has been less impressive compared to other homebuilding companies.
Growth Trajectory
Historical Growth
HOV has experienced moderate growth in revenue and earnings over the past five years. The company has benefited from the increasing demand for affordable housing and strategic acquisitions.
Future Projections
Industry analysts project continued moderate growth for HOV in the coming years, driven by favorable market trends and the company's focus on cost-efficiency and operational excellence. Recent product launches in new markets and strategic partnerships further support this growth outlook.
Market Dynamics
Industry Overview
The U.S. homebuilding industry is cyclical, influenced by economic factors, interest rates, and consumer confidence. Recent trends indicate a shift towards a more balanced market, with supply gradually catching up to demand.
HOV's Positioning
HOV is well-positioned within the industry due to its focus on affordable housing, strong regional presence, and efficient business model. The company's adaptability to changing market dynamics and commitment to innovation are key factors for its continued success.
Competitors
- D.R. Horton (DHI)
- Lennar (LEN)
- PulteGroup (PHM)
- NVR Inc. (NVR)
- Toll Brothers (TOL)
HOV holds a smaller market share compared to these larger competitors. However, the company's focus on specific market segments allows it to compete effectively. HOV's key strengths include its established brand reputation, land acquisition strategies, and customer-centric approach.
Potential Challenges and Opportunities
Key Challenges
- Rising interest rates
- Supply chain disruptions
- Labor shortages
Potential Opportunities
- Expanding into new markets
- Introducing innovative housing solutions
- Pursuing strategic partnerships
Recent Acquisitions
There have been no significant acquisitions by HOV in the last three years.
AI-Based Fundamental Rating
Based on a proprietary AI model that analyzes various financial metrics, market data, and industry trends, HOV receives a fundamental rating of 7.5 out of 10. This rating reflects the company's strong financial health, solid market positioning, and moderate growth potential.
Sources and Disclaimers
Information for this analysis was gathered from HOV's official website, U.S. Securities and Exchange Commission (SEC) filings, and reputable financial databases.
This analysis should not be considered financial advice. Individual investors should carefully research and understand the risks before making any investment decisions.
AI Summarization is directionally correct and might not be accurate.
Summarized information shown could be a few years old and not current.
Fundamental Rating based on AI could be based on old data.
AI-generated summaries may have inaccuracies (hallucinations). Please verify the information before taking action.
About Hovnanian Enterprises Inc
Exchange | NYSE | Headquaters | Matawan, NJ, United States |
IPO Launch date | 1992-03-17 | CEO & Chairman of the Board | Mr. Ara K. Hovnanian |
Sector | Consumer Cyclical | Website | https://www.khov.com |
Industry | Residential Construction | Full time employees | 1715 |
Headquaters | Matawan, NJ, United States | ||
CEO & Chairman of the Board | Mr. Ara K. Hovnanian | ||
Website | https://www.khov.com | ||
Website | https://www.khov.com | ||
Full time employees | 1715 |
Hovnanian Enterprises, Inc., through its subsidiaries, designs, constructs, markets, and sells residential homes in the United States. It offers single-family detached homes, attached townhomes and condominiums, urban infill, and active lifestyle homes with amenities, such as clubhouses, swimming pools, tennis courts, tot lots, and open areas. The company markets and builds homes for first-time buyers, first-time and second-time move-up buyers, luxury buyers, active lifestyle buyers, and empty nesters. It also provides mortgage loans, title insurance, and homeowner's insurance services. The company was founded in 1959 and is headquartered in Matawan, New Jersey.
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