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Forestar Group Inc. (NYSE:FOR ) Q1 2025 Results Conference Call January 21, 2025 11:00 AM ET Company Participants Chris Hibbetts - Vice President of Finance & Investor Relations Andy Oxley - President and CEO Jim Allen - Chief Financial Officer Mark Walker - Chief Operating Officer Conference Call Participants Carl Reichardt - BTIG Asher Sohnen - Citigroup Operator Good morning, and welcome to Forestar's First Quarter 2025 Earnings Conference Call. [Operator Instructions].

ARLINGTON, Texas--(BUSINESS WIRE)---- $FOR--Forestar reported net income of $16.5 million or $0.32 per diluted share in its first fiscal quarter of 2025.

Interest rate cut and healthy demand for certain real estate categories poise Real Estate Development industry players like HHH, GRBK and FOR well for growth.

Forestar Group is well-positioned to benefit from persistent residential housing shortage and a favorable interest rate environment, driving demand for residential lots and land sales. The company aims to double its market share to 5% by leveraging its national footprint and strategic relationship with D.R. Horton, but also with other builders too. Forestar's disciplined focus on return on equity and selective project underwriting enhances profitability and minimizes risk, ensuring high-quality developments.

Forestar missed top- and bottom-line estimates in the quarter. The company is building its inventory of lots ahead of an eventual recovery in the homebuilding market.

Forestar Group (FOR) came out with quarterly earnings of $0.76 per share, missing the Zacks Consensus Estimate of $0.89 per share. This compares to earnings of $0.93 per share a year ago.

Howard Hughes, Green Brick Partners and Forestar have been highlighted in this Industry Outlook article.

Despite a high interest rate environment, recovery in demand for certain real estate categories and constrained supply poise Real Estate Development industry players like HHH, GRBK and FOR well for growth.

Forestar Group Inc. targets double digit returns through land acquisition with significant cash and expertise, supported by financing from D.R. Horton. Given the previous unlevered FCF growth, management outlook, planned land acquisition in 2024, and my previous assumptions, I expect FCF close to $192 million in 2025. FOR recently reported constrained lot supply in the United States, which, in my view, may benefit its business model.

ARLINGTON, Texas--(BUSINESS WIRE)---- $FOR--Forestar announced that it will release financial results for its third quarter ended June 30, 2024 on Thursday, July 18, 2024.