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D.R. Horton, Inc. (DHI) vs Toll Brothers Inc. (TOL)

D.R. Horton, Inc. and Toll Brothers Inc. are both Residential Construction companies. D.R. Horton, Inc. is the larger, with a market value of $42.8B against $14.3B — 3.0× the size. Toll Brothers Inc. trades at the lower P/E: 12.4× against 15.4×. Toll Brothers Inc. grew revenue faster over the last twelve months: −1.08% against −3.52%. Toll Brothers Inc. has the higher net margin (11.1% vs 8.74%) and the higher return on invested capital (9.08% vs 9.00%). Both pay a dividend; D.R. Horton, Inc. yields more (1.15% vs 0.66%). Across the 22 metrics below, Toll Brothers Inc. leads on 14 and D.R. Horton, Inc. on 8.

Valuation

Metric DHI TOL Residential Construction median
P/E 15.36 12.38 15.45
P/S 1.32 1.35 1.32
P/B 1.84 1.71 1.24
Price to free cash flow 13.01 13.37 21.26
EV/EBITDA 11.45 10.28 12.52
EV/Sales 1.36 1.51 1.48
Earnings yield 6.51% 8.08% 6.38%
Free cash flow yield 7.69% 7.48% 4.64%

Profitability

Metric DHI TOL Residential Construction median
Gross margin 22.28% 23.75% 19.15%
Operating margin 10.93% 13.84% 7.50%
Net margin 8.74% 11.14% 6.72%
Free cash flow margin 10.13% 10.13% 8.39%
Return on equity 11.93% 14.39% 11.56%
Return on assets 8.22% 8.24% 6.99%
Return on invested capital 9.00% 9.08% 4.98%

Growth

Metric DHI TOL Residential Construction median
Revenue growth (TTM) (3.52%) (1.08%) (6.00%)
EPS growth (last fiscal year) (11.17%) (10.13%) (25.22%)
Revenue growth, 5-year CAGR 3.54% 9.15% 8.74%
Net income growth, 5-year CAGR (7.10%) 24.70% 8.25%

Health

Metric DHI TOL Residential Construction median
Debt to equity 0.26 0.32 0.17
Current ratio 6.01 4.53 3.25
Net debt to EBITDA 0.37 0.85 0.37

Dividend

Metric DHI TOL Residential Construction median
Dividend yield 1.15% 0.66% 1.15%
Payout ratio 0.18 0.08 0.18

Size

Metric DHI TOL Residential Construction median
Market cap 42.79b 14.34b 4.72b

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