InvestBattle | D.R. Horton vs Lennar

December 15, 2023by Anton Tryhubchenko

As we noted in the last week’s issue, over the past three months, one of the top growth leaders among the industries in the S&P 500 index has been the Household Durables industry (+13.7%).

The largest (by market capitalization) companies in this industry: D.R. Horton ($45.4B), which is engaged in construction and production of building materials, and Lennar ($38.6B), which is also engaged in construction and real estate investment.

Based on the latest quarterly reporting data, we analyzed the profitability, strength, and efficiency criteria for each company using the methodology of Stanford University professor Joseph Piotroski.

As you can see, in terms of fundamentals, both companies are currently performing average. Both D.R. Horton and Lennar look favorable for medium- and long-term investments.

In addition, over the past 3 months, stocks of D.R. Horton’s has grown by +18.0%, and Lennar’s has grown by +17.6% (the S&P 500 index by +3.3%). Therefore, we can see that D.R. Horton not only has outperformed its closest competitor, but also has demonstrated better results compared to the index.

So, there is no single winner in today’s battle. Therefore, it is up to each individual to decide which criteria to give preference to when making an investment decision, taking into account their goals and individual risk tolerance.
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