Hovnanian Enterprises designs, constructs, markets, and sells residential homes in the United States. The company was founded in 1959 and is based in Red Bank, New Jersey.
HOV Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Hovnanian Enterprises Inc with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Hovnanian Enterprises Inc ranked in the 73th percentile in terms of potential gain offered. More precisely, our analysis suggests the stock is undervalued by approximately 274.83% on a DCF basis. The most interesting components of our discounted cash flow analysis for Hovnanian Enterprises Inc ended up being:
Its compound free cash flow growth rate, as measured over the past 3.99 years, is 0% -- higher than only 24.22% of stocks in our DCF forecasting set.
12% of the company's capital comes from equity, which is greater than merely 3.69% of stocks in our cash flow based forecasting set.
As a business, Hovnanian Enterprises Inc experienced a tax rate of about 3% over the past twelve months; relative to its sector (Consumer Cyclical), this tax rate is higher than merely 21.38% of stocks generating free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
CTB, MBUU, LKQ, VIAC, and DISH can be thought of as valuation peers to HOV, in the sense that they are in the Consumer Cyclical sector and have a similar price forecast based on DCF valuation.