Residential lot developer Forestar cuts annual delivery guidance on weak market conditions

Forestar

22/07/2025 11:42

Overview

Forestar fiscal Q3 revenue rises 23% yr/yr to $390.5 mln, missing estimates

Net income for fiscal Q3 falls 15% yr/yr to $32.9 mln

Co lowers fiscal 2025 lot delivery guidance due to weak market conditions

Outlook

Forestar updates fiscal 2025 lot delivery guidance to 14,500-15,000 from prior guidance of between 15,000 and 15,500

Company maintains fiscal 2025 revenue guidance of $1.50 bln to $1.55 bln

Forestar cites affordability constraints impacting new home sales pace

Company expects $2.3 bln of contracted future revenue

Result Drivers

LOTS SOLD - Residential lots sold increased 11% to 3,605 lots, contributing to revenue growth

CONTRACTED LOTS - Lots contracted for sale rose 26% to 25,700, indicating strong future revenue potential

D.R. HORTON RELATIONSHIP - Strategic relationship with D.R. Horton supports significant market share aggregation

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q3 Revenue
Miss
$390.50 mln
$390.60 mln (5 Analysts)
Q3 EPS
$0.65
Q3 Net Income
$32.90 mln
Q3 Basic EPS
$0.65
Q3 Pretax Profit
$43.60 mln


Analyst Coverage

The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"

The average consensus recommendation for the construction & engineering peer group is "hold."

Wall Street's median 12-month price target for Forestar Group Inc is $28.50, about 22.5% above its July 21 closing price of $22.08

The stock recently traded at 7 times the next 12-month earnings vs. a P/E of 6 three months ago

Press Release: ID:nBwc0lpjZa

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)