Forestar Group ( NYSE: FOR ) stock is dropping 17% in after-hours trading after the home lot development company cut its guidance for full-year lot deliveries and revenue due to development delays and lower housing demand.
The company now expects to deliver ~17K lots generating $1.425B in revenue of fiscal year 2022, down from its prior guidance of 19.5K-20K lots generating $1.7B of revenue.
It also expects FY2022 pretax profit margin of ~14.25% vs. its prior guidance of 14.0%-14.5%.
"We expect continued profitable growth in the coming years, supported by our low net leverage, the engagement of our people, our strategic relationship with D.R. Horton ( DHI ) and 97,000 lots owned and controlled at June 30, 2022," said Forestar ( FOR ) Chairman Donald J. Tomnitz.
In fiscal Q3, the company generated $308.5M of revenue, down 1.4% Y/Y and trailing the $406.3M consensus. It sold 3,473 lots during the quarter, down 10% Y/Y. "Our lot deliveries were below our expectations this quarter due to increased headwinds in the development process, primarily related to municipality delays and, to a lesser extent, shortages of certain materials," said CEO Daniel Bartok.
For the quarter ended June 30, 2022, Forestar ( FOR ) posted EPS of $0.80, matching the consensus estimate, and up from $0.32 in the year-ago quarter.
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Forestar Group stock tumbles after cutting year guidance, Q3 revenue misses