Hovnanian Enterprises (HOV) AI Stock Analysis

• Market Cap: $611.08M
• Dividend Yield: N/A
• Average Volume (3M): 122.09K
• Price to Earnings (P/E): 13.8
• Beta (1Y): 1.44
• Revenue Growth: -0.84%
• EPS Growth: -76.30%
• Country: US
• Employees: 1,878
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Residential Construction
• EPS (TTM): -0.51
• Shares Outstanding: 5,155,635
• 10 Day Avg. Volume: 133,488
• 30 Day Avg. Volume: 122,089
• PEG Ratio: 0.24
• Price to Book (P/B): 1.43
• Price to Sales (P/S): 0.38
• P/FCF Ratio: 197.30
• Enterprise Value/Market Cap: 2.49
• Enterprise Value/Revenue: 0.48
• Enterprise Value/Gross Profit: 1.26
• Enterprise Value/Ebitda: 6.32
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 0.17
• Revenue Forecast (FY): $3.17B

• Rating: 63 Neutral
• Price Target: $111.00 ▼(-16.65% Downside)

The overall stock score of 63 reflects a combination of strong valuation metrics and mixed financial performance. The stock's undervaluation provides a potential opportunity, but financial risks and operational challenges, along with bearish technical indicators, weigh on the score. The earnings call adds a cautious but optimistic outlook, highlighting strategic improvements and challenges in the current market environment.

Positive Factors

Revenue Growth

Consistent revenue growth indicates a positive trajectory, reflecting the company's ability to expand its market reach and enhance product adoption.

Debt Refinancing

Successful debt refinancing enhances financial flexibility, reducing risk and potentially lowering interest expenses, thus supporting long-term stability.

Community Growth

Expansion in community count demonstrates strategic growth, positioning the company to capture more market share and drive future revenue.

Negative Factors

Net Profit Margin Decline

Declining net profit margins indicate challenges in maintaining profitability, which could impact long-term financial health if not addressed.

Cash Flow Challenges

Significant cash flow challenges limit the company's ability to invest in growth opportunities and manage debt, affecting long-term sustainability.

High Incentives

Increased reliance on incentives to drive sales can erode margins, suggesting potential difficulties in maintaining pricing power and profitability.

Hovnanian Enterprises Business Overview & Revenue Model

Company Description

Hovnanian Enterprises, Inc. (HOV) is a prominent homebuilder in the United States, primarily engaged in the development of residential properties. Founded in 1959, the company operates in various sectors, including single-family homes, multi-family homes, and active adult communities. Hovnanian focuses on creating diverse housing solutions tailored to meet the needs of different demographics, with a portfolio that includes both entry-level and luxury homes across multiple states.

How the Company Makes Money

Hovnanian Enterprises generates revenue primarily through the sale of residential properties, which includes the construction and sale of single-family homes and condominiums. The company builds homes in a variety of price ranges, enabling it to target a broad customer base. Key revenue streams include home sales, which account for the bulk of its income, as well as ancillary services such as mortgage financing and title insurance through its subsidiaries. Hovnanian also benefits from strategic partnerships with suppliers and subcontractors, allowing for cost efficiencies and improved margins. Additionally, the company may engage in joint ventures for land development, further enhancing its revenue potential.

Hovnanian Enterprises Financial Statement Overview

Summary

Hovnanian Enterprises demonstrates strong revenue growth and improved gross profit margins, reflecting positive operational trends. However, declining net profit margins and operational efficiency metrics indicate potential profitability challenges. The balance sheet shows improved leverage but remains relatively high, posing financial risk. Cash flow metrics highlight significant challenges, with negative free cash flow growth and limited cash generation relative to net income. Overall, while there are positive trends, the company faces notable financial risks and operational challenges.

Income Statement

Hovnanian Enterprises shows a solid revenue growth rate of 2.54% TTM, indicating a positive trajectory. The gross profit margin has improved significantly to 38.30% TTM, reflecting better cost management. However, the net profit margin has decreased to 5.06% TTM, suggesting some pressure on net earnings. The EBIT and EBITDA margins have also declined, indicating potential challenges in operational efficiency.

Balance Sheet

The company's debt-to-equity ratio has improved to 1.10 TTM, showing better leverage management, but still indicates a relatively high level of debt. Return on equity has decreased to 19.45% TTM, which is still strong but shows a downward trend. The equity ratio stands at 31.77% TTM, suggesting a moderate level of equity financing.

Cash Flow

Free cash flow growth is negative at -505.48% TTM, indicating significant cash flow challenges. The operating cash flow to net income ratio is low at 0.21 TTM, suggesting limited cash generation relative to net income. However, the free cash flow to net income ratio is relatively healthy at 0.84 TTM, indicating decent cash conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.14B	3.00B	2.76B	2.92B	2.78B	2.34B
Gross Profit	1.20B	601.79M	580.14M	643.43M	540.80M	372.21M
EBITDA	240.86M	355.57M	283.75M	364.39M	271.39M	143.42M
Net Income	158.88M	242.01M	205.89M	225.49M	607.82M	50.93M
Balance Sheet
Total Assets	2.63B	2.61B	2.49B	2.56B	2.32B	1.83B
Cash, Cash Equivalents and Short-Term Investments	146.59M	209.98M	434.12M	326.20M	245.97M	262.49M
Total Debt	915.45M	1.02B	1.14B	1.29B	1.37B	1.57B
Total Liabilities	1.79B	1.81B	1.91B	2.18B	2.15B	2.26B
Stockholders Equity	835.36M	800.35M	581.74M	383.04M	174.90M	-436.93M
Cash Flow
Free Cash Flow	113.60M	5.78M	416.45M	76.87M	204.27M	289.45M
Operating Cash Flow	135.03M	23.64M	435.27M	89.47M	210.21M	292.83M
Investing Cash Flow	-66.81M	-46.47M	-78.23M	-2.15M	9.00M	2.14M
Financing Cash Flow	-57.27M	-187.93M	-261.71M	-16.52M	-217.27M	-167.77M

Hovnanian Enterprises Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 133.18
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: 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 133.18 is above the 20-day moving average (MA) of 113.88, above the 50-day MA of 119.39, and above the 200-day MA of 116.44, indicating a bearish trend. The MACD of -4.76 indicates Positive momentum. The RSI at 39.01 is Neutral, neither overbought nor oversold. The STOCH value of 63.24 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HOV.

Hovnanian Enterprises Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MHO	75 Outperform	$3.34B	7.49	15.76%	―	4.77%	-9.30%
TPH	73 Outperform	$2.76B	9.47	9.47%	―	-16.60%	-29.85%
CCS	69 Neutral	$1.75B	8.70	8.37%	1.95%	-6.28%	-31.55%
LGIH	65 Neutral	$1.03B	9.82	5.21%	―	-20.62%	-45.74%
HOV	63 Neutral	$611.08M	13.76	7.76%	―	-0.84%	-76.30%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
BZH	56 Neutral	$623.77M	13.65	3.67%	―	1.77%	-66.27%

Hovnanian Enterprises Corporate Events

Hovnanian Enterprises Completes $900M Senior Notes Placement

On September 25, 2025, K. Hovnanian Enterprises, Inc. completed a private placement of $900 million in senior notes, which will mature in 2031 and 2033. The proceeds were used to redeem existing secured notes, discharge related security documents, and repay outstanding loans, thereby releasing liens on collateral and discharging obligations under previous agreements. This financial restructuring aims to optimize the company’s debt profile and enhance its financial flexibility.

The most recent analyst rating on (HOV) stock is a Hold with a $147.00 price target. To see the full list of analyst forecasts on Hovnanian Enterprises stock, see the HOV Stock Forecast page.

Hovnanian Enterprises Announces New Executive Appointments

Hovnanian Enterprises announced that its Board of Directors has appointed Alexander Hovnanian as President and Michael Wyatt as Chief Operating Officer, effective November 1, 2025. On September 17, 2025, the Compensation Committee approved a compensation package for both executives, including a base salary of $750,000 and a target multiple of 1.25 for long-term incentive awards.

The most recent analyst rating on (HOV) stock is a Hold with a $147.00 price target. To see the full list of analyst forecasts on Hovnanian Enterprises stock, see the HOV Stock Forecast page.

Hovnanian Enterprises Prices $900M Senior Notes Offering

On September 11, 2025, Hovnanian Enterprises, Inc. announced the pricing of $450 million in 8.000% Senior Notes due 2031 and $450 million in 8.375% Senior Notes due 2033, to be issued by its subsidiary K. Hovnanian Enterprises, Inc. The proceeds will be used to redeem existing secured notes, repay loans, and cover related expenses. The offering is expected to close around September 25, 2025, and the notes are being offered to qualified institutional buyers and certain offshore investors.

The most recent analyst rating on (HOV) stock is a Buy with a $171.00 price target. To see the full list of analyst forecasts on Hovnanian Enterprises stock, see the HOV Stock Forecast page.

Hovnanian Enterprises Amends Credit Agreement and Launches Offering

On September 10, 2025, Hovnanian Enterprises announced amendments to its credit agreement, extending the maturity of its revolving credit facility to 2028 and adjusting interest rates. Additionally, the company launched a private offering of $900 million in senior notes due in 2031 and 2033, intending to use the proceeds to redeem existing secured notes and repay term loans. These financial maneuvers aim to optimize the company’s debt structure and potentially enhance its financial flexibility.

The most recent analyst rating on (HOV) stock is a Buy with a $171.00 price target. To see the full list of analyst forecasts on Hovnanian Enterprises stock, see the HOV Stock Forecast page.

Hovnanian’s Earnings Call: Mixed Results Amid Challenges

Hovnanian Enterprises recently held its earnings call, revealing a mixed performance for the fiscal period. The company celebrated significant achievements in revenue growth, inventory management, and returns on equity and investment. However, these successes were tempered by challenges such as declining gross margins, increased costs, and a tough sales environment. Hovnanian is addressing these hurdles with a strategic focus on a land-light approach and community expansion.

Hovnanian Enterprises Reports Strong Revenue Growth

Hovnanian Enterprises, Inc., founded in 1959, is one of the nation’s largest homebuilders, operating in multiple states across the U.S. The company is known for its K. Hovnanian® Homes and specializes in building active lifestyle communities.