DR Horton Inc (DHI)
Profitability ratios
Return on sales
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 25.91% | 26.37% | 31.37% | 28.35% | 24.31% |
| Operating profit margin | 15.68% | 16.81% | 22.20% | 18.89% | 13.91% |
| Pretax margin | 16.94% | 17.67% | 22.68% | 19.23% | 14.65% |
| Net profit margin | 12.92% | 13.38% | 17.50% | 15.03% | 11.69% |
DR Horton Inc's profitability ratios have shown mixed performance over the past five years. The gross profit margin has fluctuated, with a notable decrease in 2020 followed by a slight increase in recent years. This indicates the company's ability to generate revenue after accounting for the cost of goods sold.
Operating profit margin has also varied, showing an upward trend until 2022, followed by a decrease in 2023 and 2024. This ratio reflects the company's efficiency in managing its operating expenses to generate profit.
The pretax margin has displayed a similar trend to the operating profit margin, peaking in 2022 before declining in subsequent years. This ratio provides insight into the company's ability to generate profits before accounting for tax expenses.
Net profit margin, which represents the company's bottom-line profitability after all expenses, has shown an increase over the period analyzed. This indicates an improvement in the company's ability to translate its revenues into net income.
Overall, while there have been fluctuations in some profitability ratios, DR Horton Inc has generally shown a positive trend in maintaining or improving its profit margins over the past five years.
Return on investment
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 15.99% | 18.30% | 24.49% | 21.85% | 14.94% |
| Return on assets (ROA) | 13.17% | 14.57% | 19.30% | 17.39% | 12.55% |
| Return on total capital | 22.35% | 24.98% | 34.93% | 31.96% | 22.94% |
| Return on equity (ROE) | 18.79% | 20.91% | 30.20% | 28.05% | 20.05% |
The profitability ratios of DR Horton Inc have shown a consistent trend of positive performance over the past five years.
Operating return on assets (Operating ROA) has generally decreased from 24.49% in 2022 to 15.99% in 2024. This indicates that the company's ability to generate profits from its assets used in its core business operations has declined slightly.
Return on assets (ROA) has followed a similar pattern, declining from 19.30% in 2022 to 13.17% in 2024. This ratio measures the company's overall efficiency in generating profit from its total assets, showing a downward trend in recent years.
Return on total capital has also decreased from 34.93% in 2022 to 22.35% in 2024. This ratio reflects the company's ability to generate returns for all its capital providers, including both debt and equity holders. The decline suggests a decrease in overall profitability relative to the total capital employed.
Return on equity (ROE) has exhibited a similar trend, dropping from 30.20% in 2022 to 18.79% in 2024. ROE indicates how effectively the company is utilizing shareholder equity to generate profits, and the declining trend suggests a lower return for equity investors.
In summary, the profitability ratios of DR Horton Inc have shown a decreasing trend over the past few years, indicating a potential need for the company to focus on improving operational efficiency and managing its capital structure to enhance profitability in the future.