In this piece, I compared two homebuilder stocks — DHI and TOL — to see which stock is better. D.R. Horton (NYSE:DHI) and Toll Brothers (NYSE:TOL) address opposite ends of the market, with Horton focused on affordable housing and Toll Brothers targeting the luxury end of the market. This fact, along with its valuation and company fundamentals, makes DHI the clear winner.
D.R. Horton (NYSE:DHI)
D.R. Horton is the largest U.S. homebuilder, and it focuses on affordable housing, giving it a clear advantage in the nationwide housing shortage. Additionally, the company’s price-to-sales (P/S) multiple has fallen back to where it stood in 2019, while its P/E ratio is even lower than where it stood then. Finally, Horton’s solid fundamentals suggest a bullish rating may be in order.
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