Oct 29, 2026 earnings call — Quarterly results and next-year outlook
Forestar reported $580.8 million revenue in Q4 and expects $1.4 billion to $1.5 billion revenue in fiscal 2027.
Revenue $0.6B (est $0.6B) · EPS $1.15 (est $1.25) · Next-quarter revenue outlook $1.4B–$1.5B
Key quotes
"During the fourth quarter, we invested $299 million in land acquisition and development. And for the full year, we invested $1.3 billion."
"We ended the year with $1.3 billion of liquidity, including $657 million of unrestricted cash and $658 million of available capacity on our undrawn revolving credit facility."
"D.R. Horton is our largest and most important customer. In fiscal 2026, 14% of the homes D.R. Horton started were on a Forestar-developed lot."
Analyst Q&A 2
Reaching one-third of Horton's deliveries
Q (Ryan Gilbert · BTIG): He asked how Forestar will reach the goal of 1/3 of D.R. Horton's deliveries on Forestar lots and what levers in 2027–2028 will help. He also asked how the $650 million cash will be deployed — land, strategic deals, or buybacks — and whether any distressed land opportunities are emerging.
A: They said they have made progress but must grow faster because Forestar is in 65 markets and Horton is in around 130, and scaling out West should help in '27 and '28. They plan to invest $1.3 billion in land and development, with the majority in development for fiscal '27, and buybacks are not the highest cash priority. They are seeing more distressed opportunities pick up in the back half of the quarter, are reviewing each opportunity, and said those are coming more from private builder developers than land banking competition.
"We have made significant progress on that 1/3 in a lot of markets." — Anthony Oxley (CEO)
Why gross profit fell and cost outlook
Q (Paul Przybylski · Wolfe): He asked whether lower gross margin was driven by higher input costs or pricing actions, and what drove the margin change. He also asked whether Forestar should buy lots now in the weak Western market or wait, and if oil/fuel surcharges will hurt margins in 2027.
A: They said the lower gross margin was caused by two unusual items: two impairments and a project closeout with extra legal and stormwater remediation costs, and if you exclude those their gross profit would be 20.8%, within the prior 20% to 23% band. They said they have not broadly seen cost increases, pricing is stabilized, contractor availability has improved, and core lot sales margin was 21% versus 21.3% last year. On the West they focus on smaller, quicker-turning deals rather than large projects, and on oil-related cost pressure they are not seeing a material impact today and it takes us 12 months to put a lot on the ground.
"We had two impairments in the quarter for $7.6 million." — James Allen (CFO)