SCOTTSDALE, Ariz. - Taylor Morrison (NYSE:TMHC) Home Corporation (NYSE: TMHC), a prominent national homebuilder, reported robust financial results for the second quarter ended June 30, 2024.
The company's earnings per share (EPS) of $1.97 exceeded analyst expectations by $0.07, while revenue for the quarter was $1.99 billion, surpassing the consensus estimate of $1.87 billion.
In comparison to the second quarter of the previous year, Taylor Morrison experienced a 3% increase in net sales orders to 3,111, with home closings revenue declining slightly by 4% to $1.9 billion. The average closing price for homes dropped by 6% to $600,000, which was offset by a 2% increase in home closings to 3,200 units. The company's home closings gross margin was reported at 23.8% on a reported basis and 23.9% on an adjusted basis.
Sheryl Palmer, Chairman and CEO of Taylor Morrison, attributed the strong quarter to the company's diversified consumer and geographic strategy, which led to better-than-expected closings volume and home closings gross margin. Palmer expressed confidence in the company's updated outlook, which now forecasts the delivery of 12,600 to 12,800 homes this year with a home closings gross margin around 24%.
For the third quarter of 2024, Taylor Morrison expects home closings to be approximately 3,200 with an average closing price around $600,000. The home closings gross margin is anticipated to be around 24%, and the ending active community count is projected to be between 330 to 340. The effective tax rate and diluted share count are expected to be approximately 25% and 106 million, respectively.
Looking ahead to the full year 2024, the company has adjusted its home closings forecast to be between 12,600 to 12,800 homes, with an average closing price ranging from $600,000 to $610,000. The home closings gross margin is expected to remain around 24%. The SG&A as a percentage of home closings revenue is predicted to be in the high-9% range, and the effective tax rate is projected to be approximately 25%. The diluted share count is now expected to be around 107 million. Additionally, Taylor Morrison plans to spend between $2.3 billion to $2.5 billion on land and development and anticipates share repurchases to total approximately $300 million.
Taylor Morrison's financial strength is further evidenced by its total liquidity of $1.3 billion, including $247 million of unrestricted cash and $1.1 billion of total capacity on the company's revolving credit facilities. The gross homebuilding debt to capital ratio was 25.4%, down from 29.7% a year ago, showcasing the company's solid balance sheet.
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