Hovnanian (HOV)
NYSE:HOV
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Hovnanian Enterprises
(NYSE:HOV)
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Rating:60Neutral
Price Target:
$121.00
▲(4.24% Upside)
Action:Reiterated
Date:05/22/26
The score is driven primarily by mixed financial performance: strong recent free cash flow and signs of balance sheet improvement are offset by cooled revenue trends and compressed margins, with some uncertainty around deleveraging consistency. Technicals add a cautious tone (negative MACD and still below the 200-day average). The latest earnings call supports a guarded improvement narrative, but near-term profit guidance is modest, while valuation signals are weak/limited due to a negative P/E and no dividend yield.
Positive Factors
Strong free cash flow
Sustained, large operating and free cash flow improves financial flexibility: it funds land/development spend, supports debt paydown or opportunistic buybacks, and cushions working-capital swings typical in homebuilding. Durable FCF reduces refinancing risk and enables strategic choices over coming quarters.
Negative Factors
Declining revenues and deliveries
Falling deliveries and softer revenue reduce scale and amplify fixed-cost leverage in the near term. Persistent demand weakness or slower community absorption can compress earnings, extend cash conversion cycles, and limit ability to restore prior-cycle margins without sustained sales recovery.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong free cash flow
Sustained, large operating and free cash flow improves financial flexibility: it funds land/development spend, supports debt paydown or opportunistic buybacks, and cushions working-capital swings typical in homebuilding. Durable FCF reduces refinancing risk and enables strategic choices over coming quarters.
Read all positive factors
Hovnanian Enterprises (HOV) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$686.45M
Dividend YieldN/A
Average Volume (3M)119.86K
Price to Earnings (P/E)19.5
Beta (1Y)1.29
Revenue Growth-4.77%
EPS Growth-87.32%
CountryUS
Employees1,878
SectorConsumer Cyclical
Sector Strength84
IndustryResidential Construction
Share Statistics
EPS (TTM)6.98
Shares Outstanding5,153,480
10 Day Avg. Volume148,077
30 Day Avg. Volume119,855
Financial Highlights & Ratios
PEG Ratio-0.16
Price to Book (P/B)0.93
Price to Sales (P/S)0.26
P/FCF Ratio4.67
Enterprise Value/Market Cap1.72
Enterprise Value/Revenue0.40
Enterprise Value/Gross Profit0.72
Enterprise Value/Ebitda9.92
Forecast
1Y Price Target
$74.00Price Target Upside-36.25% Downside
Rating ConsensusModerate Sell
Number of Analyst Covering1
EPS Forecast (FY)-0.99
Revenue Forecast (FY)$2.66B
Hovnanian Enterprises Business Overview & Revenue Model
Company Description
Hovnanian Enterprises, Inc. engages in the design, construction, marketing, and sale of residential homes in the United States. It offers single-family detached homes, attached townhomes and condominiums, urban infill, and active lifestyle homes w...
How the Company Makes Money
Hovnanian Enterprises makes money primarily by selling newly constructed homes to homebuyers. Its core revenue stream is home sales revenue, which is generally recognized at the time a home is delivered/closed to the buyer; profitability depends o...
Hovnanian Enterprises Earnings Call Summary
Earnings Call Date:May 21, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Sep 03, 2026
Earnings Call Sentiment Positive
The call conveyed a cautiously positive tone: management reported sequential improvements in gross margin, declining incentives, stronger liquidity, reduced QMI inventory, and operational efficiencies while still facing year-over-year revenue and delivery declines, elevated incentive levels versus last year, modest near-term profit guidance, and ongoing macro-related volatility. The company emphasized disciplined land underwriting, a land-light approach, and expectation of sequential improvement into Q4, balancing current margin pressure with clear actions to improve returns over time.Positive Updates
Sequential Margin Improvement
Adjusted gross margin improved sequentially to 14.3% in Q2 (from 13.4% in Q1), exceeding the upper end of guidance and marking a 0.9 percentage point sequential increase after management characterized Q1 as the trough.
Negative Updates
Year-over-Year Revenue and Deliveries Decline
Total revenues declined 3% year-over-year while deliveries were down 12% year-over-year amid a more competitive selling environment, despite a land sale partially offsetting lower deliveries.
Read all updates
Q2-2026 Updates
Positive
Negative
Sequential Margin Improvement
Adjusted gross margin improved sequentially to 14.3% in Q2 (from 13.4% in Q1), exceeding the upper end of guidance and marking a 0.9 percentage point sequential increase after management characterized Q1 as the trough.
Read all positive updates
Company Guidance
For the third quarter of fiscal 2026 the company guided total revenues of $650–$750 million, adjusted gross margin of 14.0%–15.0%, SG&A of 12.5%–13.5% of revenues, JV income between breakeven and $10 million, adjusted EBITDA of $30–$40 million, and adjusted pretax income between breakeven and $10 million; the outlook assumes broadly stable market conditions (no material increases in mortgage rates, tariffs, inflation, cancellation rates or construction cycle times), continued use of mortgage-rate buy downs and similar incentives, and excludes any SG&A impact from Phantom stock expense tied to the $112.44 quarter‑end share price — management noted Q3 profits would be modest but expects a sequential rebound in adjusted pretax income in Q4, and warned results remain sensitive to closing timing and mix (particularly the share of quick‑move‑in homes).Hovnanian Enterprises Financial Statement Overview
Summary
Income Statement
56
Neutral
Balance Sheet
63
Positive
Cash Flow
74
Positive
| Breakdown | TTM | Oct 2025 | Oct 2024 | Oct 2023 | Oct 2022 | Oct 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.94B | 2.98B | 3.00B | 2.76B | 2.92B | 2.78B |
| Gross Profit | 1.63B | 420.67M | 601.79M | 580.14M | 643.43M | 540.80M |
| EBITDA | 119.20M | 135.39M | 355.57M | 283.75M | 349.18M | 263.13M |
| Net Income | 56.53M | 63.87M | 242.01M | 205.89M | 225.49M | 607.82M |
Balance Sheet | ||||||
| Total Assets | 2.73B | 2.63B | 2.61B | 2.49B | 2.56B | 2.32B |
| Cash, Cash Equivalents and Short-Term Investments | 349.57M | 285.38M | 209.98M | 434.12M | 326.20M | 245.97M |
| Total Debt | 970.67M | 957.30M | 1.02B | 1.17B | 1.31B | 1.39B |
| Total Liabilities | 1.90B | 1.80B | 1.81B | 1.91B | 2.18B | 2.15B |
| Stockholders Equity | 835.74M | 830.93M | 800.35M | 581.74M | 383.04M | 174.90M |
Cash Flow | ||||||
| Free Cash Flow | 357.86M | 166.18M | 5.78M | 416.45M | 76.87M | 204.27M |
| Operating Cash Flow | 385.04M | 188.28M | 23.64M | 435.27M | 89.47M | 210.21M |
| Investing Cash Flow | -70.06M | -66.01M | -46.47M | -78.23M | -2.15M | 9.00M |
| Financing Cash Flow | -81.44M | -70.39M | -187.93M | -261.71M | -16.52M | -217.27M |
Hovnanian Enterprises Technical Analysis
Positive
116.08
Price Trends
109.31
Positive
113.98
Negative
120.25
Negative
Market Momentum
-0.18
Negative
52.51
Neutral
76.19
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HOV, the sentiment is Positive. The current price of 116.08 is above the 20-day moving average (MA) of 105.52, above the 50-day MA of 109.31, and below the 200-day MA of 120.25, indicating a neutral trend. The MACD of -0.18 indicates Negative momentum. The RSI at 52.51 is Neutral, neither overbought nor oversold. The STOCH value of 76.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 |
|---|---|---|---|---|---|---|---|
70 Outperform | $3.37B | 9.52 | 11.42% | ― | -1.83% | -30.18% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
60 Neutral | $686.45M | 19.50 | 4.39% | ― | -4.77% | -87.32% | |
57 Neutral | $1.52B | 11.63 | 5.16% | 1.99% | -7.87% | -54.59% | |
51 Neutral | $694.01M | -185.99 | -0.32% | ― | -13.36% | -104.38% | |
50 Neutral | $1.11B | 15.65 | 3.39% | ― | -22.62% | -60.74% |
* Consumer Cyclical Sector Average
HOV
Hovnanian Enterprises
110.36
22.40
25.47%
BZH
Beazer Homes
25.39
4.70
22.72%
MHO
M/I Homes
131.62
26.57
25.29%
LGIH
LGI Homes
47.81
-0.74
-1.52%
CCS
Century Communities
52.82
2.77
5.54%
Hovnanian Enterprises Corporate Events
Executive/Board ChangesShareholder Meetings
Hovnanian Shareholders Approve Expanded Stock Incentive Plan
Positive
Apr 1, 2026
At its 2026 Annual Meeting of Stockholders held on March 31, 2026, Hovnanian Enterprises’ shareholders approved the Fourth Amended and Restated 2020 Stock Incentive Plan, which is substantially similar to the prior plan but increases the poo...
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.