DR Horton, Inc., a leading homebuilder, announced today that it has completed the sale of $700 million of senior unsecured notes bearing 5% interest due October 15, 2034. The offering, which closed today, generated net proceeds of approximately $688.5 million, after underwriting discounts.
The notes are guaranteed by most of the company’s current homebuilding subsidiaries and will pay interest semi-annually beginning April 15, 2025. The notes have been approved for listing on the New York Stock Exchange under the ticker symbol NYSE:DHI.
According to the terms of the agreement, DR Horton has the right to redeem the notes at any time. If redemption occurs before July 15, 2034, the redemption price will be the greater of the Treasury rate plus 20 basis points or 100% of the principal amount. If redemption occurs after July 15, 2034, the redemption price will be 100% of the principal amount plus accrued interest.
If a change of control and a downgrade of the ratings occur simultaneously, the company would be required to offer to repurchase the notes at 101% of the principal amount plus accrued interest.
The notes will rank equally with the Company’s existing and future unsecured indebtedness that is not subordinated, and the subsidiary guarantees will rank equally with other unsecured indebtedness.
In other recent news, leading homebuilder DR Horton delivered impressive third quarter earnings per share (EPS) of $4.10, beating expectations. The success was driven by higher homebuilding gross margins and average sales prices, as well as higher rental pre-tax income.
InvestingPro Insights
DR Horton, Inc. (NYSE:DHI) is poised for future growth through the sale of senior unsecured notes, and analyzing the company’s financial metrics and market performance can give investors a clearer picture of the company’s potential. According to InvestingPro data, DR Horton has a strong market presence with a robust market capitalization of $56.88 billion. The company’s price-to-earnings (P/E) ratio is 11.64, indicating that the company’s stock is trading at a relatively reasonable valuation relative to its earnings. Furthermore, DR Horton’s trailing 12-month revenue growth rate of 7.82% indicates the company’s ability to grow sales year-over-year.
InvestingPro Tips highlights that DR Horton has raised its dividend for 10 consecutive years and maintained its dividend payment for 11 consecutive years, reflecting its commitment to returning value to shareholders. Additionally, analysts have revised earnings upwards for the coming period, indicating confidence in the company’s financial outlook. These insights, coupled with the knowledge that DR Horton operates with moderate debt and has liquid assets in excess of short-term liabilities, will be especially valuable for investors assessing the company’s financial position post-listing.
For those looking for more in-depth analysis, InvestingPro has more tips, including insights into the company’s share price movement and long-term earnings. To explore additional tips on DR Horton and a comprehensive suite of investment tools, visit the InvestingPro platform.
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