Earnings Highlights - Hovnanian Enterprises

LONDON, January 7, 2015 /PRNewswire/ --

Investor-Edge.com has issued free post-earnings coverage on Hovnanian Enterprises Inc. (NYSE: HOV). On December 10, 2014, the company reported its Q4 FY14 and full-year FY14 financial results (period ended October 31, 2014). Click on http://www.investor-edge.com/FreeReports to read our free earnings review on Hovnanian Enterprises Inc. (Hovnanian). The company's total revenue for Q4 FY14 and FY14 increased 18.0% Y-o-Y and 11.4% Y-o-Y, respectively. The Chairman, President, and CEO of Hovnanian, Ara K. Hovnanian, stated that although the company generated growth in revenues and achieved its second consecutive year of profitability, 2014 had been a disappointing year for the housing industry and Hovnanian. Our free coverage report can be accessed at:

http://www.investor-edge.com/register

Earnings Overview 

During Q4 FY14, Hovnanian's total revenue increased to $698.39 million from $591.69 million in Q4 FY13. The company's total revenue in Q4 FY14 outperformed Bloomberg analysts' forecasts of $646.00 million. For Q4 FY14, Hovnanian's homebuilding gross margin, before interest expense and land charges included in cost of sales, stood at 19.3% compared with 22.6% in Q4 FY13. The company recorded total selling, general & administrative expense (SG&A) of $65.2 million, or 9.3% of total revenues, in Q4 FY14 compared to $63.0 million, or 10.6% of total revenues, in Q4 FY13. For Q4 FY14, total interest expense as a percentage of total revenues declined 140 basis points Y-o-Y to 5.3%. The free research on HOV can be downloaded as in PDF format at:

http://get.Investor-Edge.com/pdf/?c=Hovnanian%20Enterprises&d=07-Jan-2015&s=HOV

In Q4 FY14, Hovnanian's deliveries, including unconsolidated joint ventures, increased 5.5% Y-o-Y to 1,916 homes. As of October 31, 2014, Hovnanian's consolidated active selling communities increased to 201 communities compared with 192 communities as of October 31, 2013. Additionally, Hovnanian's dollar value of consolidated net contracts increased 15.4% Y-o-Y to $511.8 million in Q4 FY14.

Hovnanian reported adjusted EBITDA of $77.67 million in Q4 FY14 compared to $77.41 million in Q4 FY13. For Q4 FY14, Hovnanian's net income surged to $322.46 million, or $1.95 per fully diluted common share, from net income of $32.82 million, or $0.21 per diluted common share, in Q4 FY13. Analysts from Bloomberg had expected a net income of $34.69 million, or $0.22 per diluted share, in Q4 FY14.

For FY14, Hovnanian recorded total revenue of $2.06 billion compared to $1.85 billion in FY13. The company's FY14 total revenue came above Bloomberg analysts' expectation of $2.01 billion. The company's homebuilding gross margin, before interest expense and land charges included in cost of sales for FY14, came at 19.9%, compared with 20.1%, in FY13. Additionally, the company recorded total SG&A of $254.9 million, or 12.4% of total revenues in FY14, compared to $220.2 million, or 11.9% of total revenues in FY13. For FY14, total interest expense as a percentage of total revenues declined 90 basis points Y-o-Y to 6.9%. Sign up and read the free analyst's notes on HOV at:

http://get.Investor-Edge.com/pdf/?c=Hovnanian%20Enterprises&d=07-Jan-2015&s=HOV

In FY14, Hovnanian's deliveries, including unconsolidated joint ventures, were 5,934 homes, compared with 5,930 homes, in FY13. Additionally, the company's dollar value of consolidated net contracts increased 10.0% Y-o-Y to $2.11 billion in FY14.

Hovnanian adjusted EBITDA for FY14 was $173.43 million compared to $179.61 million, in FY13. The company's FY14 net income surged to $307.14 million, or $1.87 per diluted common share, from a net income of $31.30 million, or $0.22 per diluted common share, in FY13. Analysts from Bloomberg had expected a net income of $19.83 million, or $0.13 per diluted share, in FY14. Hovnanian's total liquidity as on October 31, 2014 was $309.2 million compared to $373.5 million as on October 31, 2013.

Moving forward, Mr. Hovnanian said that the company has started FY15 on a better note and will be focused on growing its revenues so as to leverage the fixed SG&A and interest costs, and drive increased profitability. He concluded that the housing industry remains in the early stages of a recovery and stated that improving demographic and employment trends should result in a more robust housing market. Visit Investor-Edge and access the latest research on HOV at:

http://get.Investor-Edge.com/pdf/?c=Hovnanian%20Enterprises&d=07-Jan-2015&s=HOV

Stock Performance  

On the day of the earnings release, December 10, 2014, Hovnanian's stock surged 5.38%, to end the session at $4.11. The stock has moved both ways since then with the losses outweighing the gains so far. On the last close, Tuesday, January 06, 2014, the stock finished 5.62% lower at $3.86, after vacillating between $3.85 and $4.16. A total of 4.46 million shares were traded, which was above its three months average volume of 2.65 million shares. Over the last three months, Hovnanian's shares have advanced 4.32%. However, the stock has plummeted 6.54% in the previous three trading sessions and 39.59% in the past one year. Shares in Hovnanian closed below their 50-day and 200-day moving averages of $4.03 and $4.26, respectively. Furthermore, the stock traded at a PE ratio of 2.07 and has a Relative Strength Index (RSI) of 51.29.

Sneak Peek to Corporate Insider Trading 

In the last one month, Hovnanian has not reported any share transactions by insiders to the U.S. Securities and Exchange Commission (SEC). Complimentary in-depth research on HOV is available at:

http://get.Investor-Edge.com/pdf/?c=Hovnanian%20Enterprises&d=07-Jan-2015&s=HOV

About Investor-Edge.com 

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