D.R. Horton spent $3.6 billion on its own stock and owns 23% of its lots
David Auld’s company returned more cash to shareholders than it earned in fiscal 2026, held most of its 570,600 lots under contract and bought most of what its lot developer Forestar finished.
By Alex Pham · · 3 min read
D.R. Horton repurchased 24.0 million shares for $3.6 billion in the fiscal year that ended Sept. 30 and paid $513.3 million in dividends [1]. By our math that is about $4.1 billion returned to shareholders, against net income of $2.89 billion [1].
Executive Chairman David Auld said conditions “became more challenging during the fourth quarter,” and the company expects incentives “to remain elevated in fiscal 2027” [1].
D.R. Horton owns fewer lots than it did a year ago
The company owned or controlled 570,600 lots at Sept. 30, down from 591,900, and held 77% of them through purchase contracts [1]. Owned lots fell to 130,500 from 147,000 [1].
Of the homes D.R. Horton closed in fiscal 2026, 68% were on lots developed by Forestar or third parties [1]. Its lot count includes 38,400 lots owned or controlled by Forestar [1].
Forestar sold 13,545 lots, and D.R. Horton bought most of them
Forestar, the publicly traded lot developer D.R. Horton majority-owns, sold 13,545 lots for $1.6 billion of revenue in fiscal 2026, 5% fewer lots than a year earlier [1][2]. Only 1,916 went to customers other than D.R. Horton, so we calculate that D.R. Horton took about 11,629, or 86% [2].
Chairman Donald Tomnitz said Forestar was “managing the pace of investments” and ended the year with $1.3 billion of liquidity [2]. Its net income fell 15% to $142.6 million, and it expects to deliver 12,000 to 13,000 lots in fiscal 2027 [2].
The fiscal 2027 plan has lower revenue and $3 billion of buybacks
Homebuilding cash fell to $1.03 billion from $2.21 billion during the year, and fourth-quarter results included $91.4 million of inventory impairment charges [1].
| D.R. Horton | Fiscal 2026 | Fiscal 2027 guidance |
|---|---|---|
| Consolidated revenue | $33.0 billion | $30.0 billion to $32.0 billion |
| Homes closed | 84,202 | 79,000 to 84,000 |
| Share repurchases | $3.6 billion | About $3.0 billion |
| Dividends paid | $513.3 million | About $500 million |
| Cancellation rate | 19% | Not given |
How to use this
For land and lot sellers
- Plan for a purchase contract with a deposit instead of a cash closing, since D.R. Horton holds 77% of its lots that way [1]. Ask for the deposit to become non-refundable when due diligence ends.
- Consider selling raw land to a lot developer instead of the builder. Most of D.R. Horton’s homes, 68%, now go up on lots finished by Forestar or third parties [1], and Forestar holds 19,800 owned lots already under contract to D.R. Horton [2].
For smaller builders that buy finished lots
- Ask Forestar for finished lots directly. It sold 1,916 lots to customers other than D.R. Horton in fiscal 2026, down from 2,489 [2], so outside buyers are a small and shrinking share of its sales.
For buyers of new homes
- Ask for the list of finished homes that have not sold. D.R. Horton had 8,800 at year-end, including 600 finished for more than six months [1].
- Get the incentive offer in dollars and compare it with an equal price cut. Auld said the company expects incentives to stay elevated through fiscal 2027 [1].
For investors
This is market commentary, not investment advice.
Sources
- [1]D.R. Horton, Inc., D.R. Horton reports fiscal 2026 fourth quarter and full year results (SEC Form 8-K, Exhibit 99.1), Oct 29, 2026.
- [2]Forestar Group Inc., Forestar reports fourth quarter and fiscal 2026 results (SEC Form 8-K, Exhibit 99.1), Oct 29, 2026.
