"Record Volume Can't Offset Margin Pressure at M/I Homes M/I Homes CEO Robert Schottenstein called Q3 "solid" despite "continued challenging housing market conditions." The company delivered 2,296 homes, a quarterly record, yet revenue of $1.13 billion fell 1% year-over-year and missed the $1.17 billion consensus. Net income dropped 27% to $106.5 million as gross margins compressed from 26.8% to 23.9%."
"Valuation Gap Reveals Different Market Expectations M/I Homes trades at 8x trailing earnings compared to D.R. Horton's 14x multiple. That 41% discount reflects investor skepticism about the smaller builder's ability to weather prolonged weakness. Yet M/I Homes' return on equity of 15.8% exceeds D.R. Horton's 14.3%, and its PEG ratio of 0.78 suggests the market may be overly pessimistic about growth prospects."
M/I Homes achieved a quarterly record delivery of 2,296 homes but missed revenue consensus as sales fell 1% to $1.13 billion and net income declined 27% to $106.5 million. Gross margins contracted from 26.8% to 23.9% due to higher construction costs and pricing pressure, while new contracts dropped 6% to 1,908. M/I Homes operates mainly in Ohio, Texas, and Florida, creating regional exposure. D.R. Horton experienced a 22% year-over-year earnings decline despite a similar operating margin and $34.25 billion in trailing revenue, as higher mortgage rates and home prices depressed buyer demand. M/I trades at an 8x trailing P/E versus D.R. Horton at 14x, with M/I reporting a 15.8% return on equity and a 0.78 PEG ratio, indicating potential market skepticism about the smaller builder's resilience.
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