The homebuilding sector's hot streak stayed intact Thursday, this time in the form of big earnings and an upbeat forecast from Denver-based
The company reported second-quarter earnings of $102.6 million, or $2.25 a share, the highest for any second quarter in M.D.C.'s history and 24% above the profit of $82.6 million, or $1.87 a share, for the same period a year ago.
Revenue rose to $1.05 billion, including $1.03 billion from homebuilding, vs. $875.5 million last year. On average, analysts polled by Thomson First Call were expecting earnings of $2.06 a share and sales of $982.6 million for the second quarter.
"Low interest rates, increasing job growth, declining unemployment, rising consumer confidence, strong demographic trends and a generally improving economy have provided the platform for outstanding performances by all of the well-capitalized public homebuilders," the company said in a press release.
"We believe that the increased use of adjustable rate, interest-only mortgages and purchases of homes for investment, while receiving a great deal of publicity, remain limited threats to our industry's well-being," M.D.C. continued.
With a quarter-end backlog of more than 9,200 homes, M.D.C. said it's positioned to post new highs for revenue and earnings in 2005, and the company is optimistic for "continued solid growth in 2006." The company closed 3,512 homes in the second quarter.
The company, whose units build homes under the name Richmond American Homes, also said that "the continued strength in demand for new homes in our long-standing markets, combined with the ramping up of our operations in our newer markets in Utah, Florida, Delaware Valley and Chicago, enable us to look forward to the balance of 2005 and 2006 with optimism that we can meet our goals for future growth."