Hovnanian’s stock drops after Q2 earnings miss

Hovnanian Enterprises Inc. (NYSE: HOV) missed earnings estimates for the second quarter of 2019 while revenues were in line with expectations. Analysts had forecasted a loss of $1.77 per share on revenue of $441 million. Shares were down 2.1% in morning trade on Thursday.

Total revenues decreased to $441 million from $503 million in the same period last year. Homebuilding revenues for unconsolidated joint ventures grew 29.7% to $125.7 million during the quarter.

Net loss was $15.3 million, or $2.56 per share, compared to $9.8 million, or $1.65 per share, in the prior-year period.

Consolidated contracts per community fell 0.9% to 10.5 contracts per community. Contracts per community, including unconsolidated joint ventures, decreased 3.6% to 10.8 contracts per community. The consolidated community count was up 11.4% year-over-year to 147 communities at the end of the quarter.

The number of consolidated contracts increased 10.1% to 1,546 homes. The number of contracts, including unconsolidated JVs, were up 4% to 1,775 homes. The dollar value of consolidated contract backlog, as of April 30, 2019, increased 5.5% to $949.9 million.

Consolidated deliveries totaled 1,085 homes, down 10.7% compared to a year ago. During the second quarter, approx. 2,500 lots were put under option or acquired in 32 communities, including unconsolidated joint ventures. As of April 30, 2019, consolidated lots controlled increased by 17.1% to 31,087 on a year-over-year basis.

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