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what it is
Hovnanian builds new homes, then sells mortgage and title services to the same buyers.
how it gets paid
Last year Hovnanian Enterprise made $3.0B in revenue. Single-family detached homes was the main engine at $1.55B, or 52% of sales.
why growth slowed
Revenue fell 0.9% last year. Revenue was $632M, down 6% vs. prior year, while gross margin landed at 10.1%.
what just happened
HOV reported $2.62 EPS even though Wall Street wanted a $0.98 loss.
At a glance
C+ balance sheet — struggling to keep the lights on
10/100 earnings predictability — expect surprises
16.7x trailing p/e — the market's not buying it — or you found a deal
4.6% return on capital — nothing to write home about
$7.43 fy2025 eps est
xvary composite: 28/100 — weak
What they do
Hovnanian builds new homes, then sells mortgage and title services to the same buyers.
You do not need a cult brand to sell a house. Hovnanian has 140 communities in 27 markets across 13 states. That is distribution, not glamour. With a $519,000 average sale price, each closing matters.
How they make money
$3.0B
annual revenue · their business grew -0.9% last year
Single-family detached homes
$1.55B
+3.0%
Attached townhomes and condos
$0.70B
+1.0%
Urban infill homes
$0.35B
+4.0%
Active lifestyle homes
$0.25B
+2.0%
Financial services
$0.15B
+6.0%
The products that matter
builds and sells homes
Homebuilding
$2.9B · 96.7% of revenue
it's almost the entire company at $2.9B of annual revenue, and Q1 showed the problem in plain English: $632M of quarterly revenue with only a 10.1% gross margin.
core profit driver
higher-end buyer mix
Move-Up & Active-Adult Communities
Q1 profitability focus
management is pushing mix toward higher-margin buyers because $20.9M of net income on a $632M quarter leaves very little room for bad pricing or higher build costs.
margin watch
joint-venture home sales
Unconsolidated Joint Ventures
$72.4M from 118 homes
these ventures generated $72.4M in Q1 revenue from 118 homes. that shows the land-light model is real. it also shows how small it still is next to a $3.0B company.
lower land intensity
Key numbers
$3.0B
annual revenue
This is the top line. It tells you the company is still moving real money through the business.
$930M
long-term debt
That debt stack is 63% of capital, so rate changes and refinancing matter a lot more here than at debt-light builders.
2.8%
operating margin
This is the profit left after the bills. At 2.8%, a tiny pricing miss can erase a lot of earnings.
16.7x
trailing p/e
You are paying 16.7 times earnings for a business with 4.6% return on capital. That is not a bargain.
Financial health
C+
strength
- balance sheet grade C+ — weak — may struggle to fund operations
- risk rank 5 — safer than 5% of stocks
- price stability 5 / 100
- long-term debt $930M (63% of capital)
C+ — balance sheet grade and long-term debt are flagged. this stock carries more risk than average.
Total return vs. market
Return history isn't available for HOV right now.
source: institutional data · return history unavailable
What just happened
beat estimates
HOV reported $2.62 EPS even though Wall Street wanted a $0.98 loss.
Revenue was $632M, down 6% vs. prior year, while gross margin landed at 10.1%. The beat came from the bottom line, not from sales growth.
$632M
revenue
$2.62
eps
10.1%
gross margin
the number that mattered
EPS of $2.62 beat the -$0.98 estimate by $3.60 per share.
source: company earnings report, 2026
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What could go wrong
the top risk is gross margin failing to recover above the low-double-digit range. for Hovnanian, that is not a small modeling tweak. it is the line between a real turnaround and a debt-heavy builder treading water.
high
margin recovery stalls
Q1 gross margin was 10.1%. management guided to 13–14% adjusted gross margin in Q2. if the company cannot close that gap, the profit rebound loses credibility fast.
on a $632M quarter, a few points of margin are the difference between a decent quarter and one the market writes off.
high
debt stays heavy while profits stay thin
long-term debt is $930M, or 63% of capital. that's manageable only if home sales keep converting into stronger margins and cash generation.
if orders slow or pricing slips, the balance sheet gives you less room to be patient.
med
inventory turnover slips
inventory turnover is 1.7x. that needs to stay healthy. if it falls below 1.5x, capital gets tied up longer and the operating story gets slower.
slower turns would pressure cash, returns, and confidence in the model at the same time.
med
valuation is not cheap enough to be a shield
the stock trades at 16.7x trailing earnings and pays no dividend. if execution weakens, you do not have a deep-discount multiple or cash yield acting as cover.
that makes future returns more dependent on operating improvement than on rerating hope.
four identified risks. the combined picture is straightforward: 10.1% gross margin plus $930M of debt means the margin line matters more than the EPS headline.
source: institutional data · regulatory filings · risk analysis
Pay attention to
calendar
Q2 2026 earnings report
the company guided revenue to $625M–$725M and adjusted gross margin to 13–14%. that's the next proof point for whether Q1 was a turning point or just a loud quarter.
metric
inventory turnover
currently 1.7x. if it drops below 1.5x, the land-light story starts looking a lot less light.
trend
mix shift into higher-margin communities
move-up and active-adult communities are supposed to support profitability. if net income stays thin after the shift, the mix story is not doing enough work.
risk
debt versus operating progress
$930M of long-term debt is manageable only if operations improve with it. if margins wobble while debt stays this high, the equity gets much less forgiving.
Analyst rankings
earnings predictability
10 / 100
in human-speak, analysts do not expect this company to deliver smooth, boring quarters.
risk rank
5
safer than just 5% of stocks. translation: this is a high-risk name even before you make a call on housing demand.
source: institutional data
Institutional activity
institutional ownership data for HOV is being compiled.
source: institutional data
Price targets
3-5 year target range
n/a
n/a
$124
current price
n/a
target midpoint · n/a from current
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