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Hovnanian Enterprises
(NYSE:HOV)
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Rating:53Neutral
Price Target:
$92.00
▼(-28.30% Downside)
Action:Reiterated
Date:10/20/26
The score is held back mainly by weak technicals (downtrend below major moving averages with negative MACD) and unfavorable valuation (very high P/E). Financial performance is mixed—strong cash flow and improved leverage help, but very thin current profitability is a key risk. The latest earnings call was a relative positive with guidance pointing to sequential improvement in revenue and margins, partially offsetting the negatives.
Positive Factors
Strong Cash Generation
Solid operating and free cash flow indicate that the company is converting homebuilding activity into cash despite weak reported profitability. This supports debt reduction, land investment and liquidity preservation, giving Hovnanian greater flexibility through housing-market volatility over the next several quarters.
Negative Factors
Thin Current Profitability
Very thin net profitability leaves limited protection against modest changes in home prices, incentives, construction costs or closing volume. Although the business has produced stronger margins in prior housing conditions, the current earnings base is vulnerable and may constrain internally funded growth.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong Cash Generation
Solid operating and free cash flow indicate that the company is converting homebuilding activity into cash despite weak reported profitability. This supports debt reduction, land investment and liquidity preservation, giving Hovnanian greater flexibility through housing-market volatility over the next several quarters.
Read all positive factors
Hovnanian Enterprises (HOV) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$599.98M
Dividend YieldN/A
Average Volume (3M)115.53K
Price to Earnings (P/E)97.4
Beta (1Y)1.11
Revenue Growth-10.16%
EPS Growth-95.27%
CountryUS
Employees1,891
SectorConsumer Cyclical
Sector Strength84
IndustryResidential Construction
Share Statistics
EPS (TTM)1.04
Shares Outstanding5,122,255
10 Day Avg. Volume142,495
30 Day Avg. Volume115,532
Financial Highlights & Ratios
PEG Ratio-0.20
Price to Book (P/B)0.93
Price to Sales (P/S)0.26
P/FCF Ratio4.67
Enterprise Value/Market Cap2.69
Enterprise Value/Revenue0.57
Enterprise Value/Gross Profit1.79
Enterprise Value/Ebitda20.12
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)1.26
Revenue Forecast (FY)$2.81B
Hovnanian Enterprises Business Overview & Revenue Model
Company Description
Hovnanian Enterprises, Inc. is a leading company focused on the entire process of developing residential properties across the United States. This includes everything from the initial design and construction to the marketing and eventual sale of h...
How the Company Makes Money
Hovnanian Enterprises makes money primarily by building and selling newly constructed homes. Its core revenue stream is home sales revenue recognized when a home is delivered/closed to the buyer, which reflects the contracted selling price of the ...
Hovnanian Enterprises Earnings Call Summary
Earnings Call Date:Aug 20, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Dec 03, 2026
Earnings Call Sentiment Positive
The call balanced near-term challenges (a narrow adjusted pretax miss, lower JV income, elevated incentives, some choppiness in contracts, and modest cost pressures) against stronger underlying operational and financial positioning (revenues slightly above midpoint, sequential gross margin improvement, strong liquidity, improved land mix with 87% option lots, a 29% reduction in QMI inventory since early 2025, a high 74% backlog conversion, and constructive Q4 guidance). Management emphasized disciplined underwriting, capital efficiency, and a path to continued margin recovery. On balance, the progress on margins, balance sheet strength, land-mix improvement, and robust guidance for Q4 outweigh the transitory operational setbacks described for the quarter.Positive Updates
Revenue in Line with Guidance
Total revenues were $706 million in Q3, slightly above the midpoint of guidance. Company provided Q4 revenue guidance of $800M–$900M (midpoint $850M), implying ~20.4% sequential increase versus Q3 at the midpoint.
Negative Updates
Adjusted Pretax Miss for the Quarter
Adjusted pretax was a loss of $2 million in Q3, slightly below the bottom of the guidance range (guidance bottom $0). Management noted this is the first time in 23 quarters adjusted pretax finished below the guidance range.
Read all updates
Q3-2026 Updates
Positive
Negative
Revenue in Line with Guidance
Total revenues were $706 million in Q3, slightly above the midpoint of guidance. Company provided Q4 revenue guidance of $800M–$900M (midpoint $850M), implying ~20.4% sequential increase versus Q3 at the midpoint.
Read all positive updates
Company Guidance
Management guided fourth-quarter revenue of $800–$900 million, adjusted gross margin of 15.0%–16.5% (midpoint ~15.8%), SG&A of 10.5%–11.5% of revenues, income from joint ventures of $10–$20 million, adjusted EBITDA of $50–$65 million, and adjusted pretax income of $15–$30 million; the outlook assumes broadly stable market conditions, ongoing use of mortgage-rate buydowns and similar incentives, excludes land-sale proceeds and phantom stock expense tied to the $123.90 quarter‑end stock price, and anticipates a sequential increase in community count (147 communities at quarter end) with margin improvement as newer communities underwritten for today’s incentive environment comprise a larger share of deliveries.Hovnanian Enterprises Financial Statement Overview
Summary
Income Statement
45
Neutral
Balance Sheet
62
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Oct 2025 | Oct 2024 | Oct 2023 | Oct 2022 | Oct 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.82B | 2.98B | 3.00B | 2.76B | 2.92B | 2.78B |
| Gross Profit | 904.23M | 420.67M | 601.79M | 580.14M | 643.43M | 540.80M |
| EBITDA | 80.30M | 135.39M | 355.57M | 283.75M | 372.55M | 272.86M |
| Net Income | 18.11M | 63.87M | 242.01M | 205.89M | 225.49M | 607.82M |
Balance Sheet | ||||||
| Total Assets | 2.86B | 2.63B | 2.61B | 2.49B | 2.56B | 2.32B |
| Cash, Cash Equivalents and Short-Term Investments | 258.30M | 272.77M | 209.98M | 434.12M | 326.20M | 245.97M |
| Total Debt | 934.90M | 930.21M | 1.02B | 1.14B | 1.31B | 1.39B |
| Total Liabilities | 2.04B | 1.80B | 1.81B | 1.91B | 2.18B | 2.15B |
| Stockholders Equity | 818.67M | 830.93M | 800.35M | 581.74M | 383.04M | 174.90M |
Cash Flow | ||||||
| Free Cash Flow | 197.78M | 166.18M | 5.78M | 416.45M | 76.87M | 204.27M |
| Operating Cash Flow | 218.84M | 188.28M | 23.64M | 435.27M | 89.47M | 210.21M |
| Investing Cash Flow | -43.69M | -66.01M | -46.47M | -78.23M | -2.15M | 9.00M |
| Financing Cash Flow | -78.98M | -70.39M | -187.93M | -261.71M | -16.52M | -217.27M |
Hovnanian Enterprises Technical Analysis
Negative
128.32
Price Trends
114.75
Negative
121.92
Negative
118.10
Negative
Market Momentum
-5.47
Positive
44.50
Neutral
49.51
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HOV, the sentiment is Negative. The current price of 128.32 is above the 20-day moving average (MA) of 105.17, above the 50-day MA of 114.75, and above the 200-day MA of 118.10, indicating a bearish trend. The MACD of -5.47 indicates Positive momentum. The RSI at 44.50 is Neutral, neither overbought nor oversold. The STOCH value of 49.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HOV.
Hovnanian Enterprises Risk Analysis
Hovnanian Enterprises disclosed 2 risk factors in its most recent earnings report. Hovnanian Enterprises reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Hovnanian Enterprises Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
65 Neutral | $3.13B | 11.53 | 8.64% | ― | -5.81% | -38.43% | |
63 Neutral | $4.18B | 13.37 | 6.38% | 2.91% | -13.27% | -45.63% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
60 Neutral | $1.65B | 12.65 | 5.21% | 2.16% | -8.37% | -45.09% | |
53 Neutral | $599.98M | 97.38 | 2.19% | ― | -10.16% | -95.27% | |
52 Neutral | $2.86B | 12.96 | 5.93% | 2.13% | -20.80% | -50.30% |
* Consumer Cyclical Sector Average
HOV
Hovnanian Enterprises
101.27
-31.96
-23.99%
KBH
KB Home
47.05
-14.89
-24.04%
MHO
M/I Homes
123.97
-5.83
-4.49%
MTH
Meritage
64.19
-5.27
-7.58%
CCS
Century Communities
57.92
-3.99
-6.45%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.