One-glance verdict
Undervalued
$78.51 our estimate vs market $12.01
85% below our estimate, below the bear case
Fundamentals snapshot
Dream Finders Homes, Inc.
DFH · NYQ · Consumer Cyclical · Residential Construction
Current price
$12.01
52-week range
$11.76 - $30.34
Market cap
$1.09B
Balance sheet
Stretched
8,423.56x Strong cushion
Net debt $1.61B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
3 Risks
3 rewards · 3 risks
- Reward Returns 9.4% on equity, ahead of 66% of its peers.
- Reward Free cash flow was positive in 4/10 years.
- Risk Forward P/E (10.1x) is higher than trailing (8.5x) - earnings are expected to drop.
- Risk Net debt grew 118.9% over 3 years.
What this company does
Dream Finders Homes, Inc.
Dream Finders Homes builds and sells a variety of single-family houses across the United States, which is how it earns most of its money. The company also profits from offering related services needed for a home purchase, like mortgages and title insurance (which verifies the legal owner of a property). This matters because the company's financial health is closely linked to the strength of the housing market and the ability of people to get loans.
How the company got here
Dream Finders Homes was started by its current CEO, Patrick Zalupski, in 2008, right in the middle of a major housing downturn. This timing influenced the company's core strategy: being smart with money and not owning too much land at once. The company began by building a small number of homes in Jacksonville, Florida, and grew by expanding into new, fast-growing areas and by buying other regional homebuilders. In 2021, Dream Finders Homes became a public company, meaning its stock is now traded on the New York Stock Exchange.
What it actually does
Dream Finders Homes builds and sells single-family houses in several states across the U.S., including Florida, Texas, Colorado, and the Carolinas. They focus on building homes for a variety of customers, from people buying their first home to those looking for a larger house or a home in a community for adults 55 and over. A key part of their business is an "asset-light" approach, which means they often secure the rights to build on land without buying it outright until they are ready to build. This strategy helps them reduce the financial risks associated with owning large amounts of land. They also offer services like mortgages and title insurance to their homebuyers.
Southeast
This segment is where the company builds and sells homes in states like Florida, Georgia, and South Carolina. These are areas with growing populations and strong demand for new houses. Homebuyers in these communities purchase a range of homes, from starter homes to custom-built houses and residences in active adult communities. This part of the business represents a significant portion of the company's home sales.
Mid-Atlantic
In the Mid-Atlantic region, the company's operations are focused on building homes in North Carolina and the area around Washington, D.C., including parts of Maryland and Virginia. Customers in these markets are typically buying single-family homes and townhomes in communities that are attractive to commuters and families. This segment has grown through the acquisition of other local homebuilders, which has helped the company establish a strong presence in these markets.
Midwest
The Midwest segment for Dream Finders Homes primarily includes its homebuilding operations in Texas and Colorado. This division builds and sells homes in major cities like Austin, Dallas, Houston, and Denver. This segment has been a major contributor to the company's overall revenue (the total money it brings in from sales).
Financial Services
This part of the company doesn't build homes but instead provides important services to homebuyers. It offers mortgage banking (helping buyers get loans to purchase their homes) and title services (which ensures the legal ownership of the property is clear). This segment helps make the homebuying process smoother for customers and creates an additional source of income for the company. The revenue from this segment comes from fees for originating mortgages and for providing title insurance.
What management is betting on now
The company's leadership is focused on continuing to grow by expanding into new markets that have strong population and job growth. They are also committed to their "asset-light" strategy of controlling land through options rather than outright ownership to keep financial risk low. A major recent move was the planned acquisition of Beazer Homes, which would make Dream Finders one of the largest homebuilders in the country and expand its reach into more markets. Management also aims to improve profitability (the ability to make a profit from its sales) by being more efficient in its building process and reducing costs.
Price history
How the share price has moved
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Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$-222.53M
FY2024 Q4
$302.55M
FY2025 Q1
$-47.88M
FY2025 Q2
$-78.79M
FY2025 Q3
$-135.73M
FY2025 Q4
$136.03M
FY2026 Q1
$-54.81M
FY2026 Q2
$-107.24M
Revenue
$1.06B
Net income
$27.72M
Diluted EPS
0.27
Operating cash flow
$-101.52M
Free cash flow
$-107.24M
Fetching…
Sources
Revenue
$887.84M
Net income
$13.26M
Diluted EPS
0.11
Operating cash flow
$-49.55M
Free cash flow
$-54.81M
Fetching…
Sources
Revenue
$1.21B
Net income
$58.72M
Diluted EPS
0.57
Operating cash flow
$143.61M
Free cash flow
$136.03M
Fetching…
Sources
Revenue
$969.80M
Net income
$47.00M
Diluted EPS
0.47
Operating cash flow
$-130.98M
Free cash flow
$-135.73M
Fetching…
Sources
Revenue
$1.15B
Net income
$56.58M
Diluted EPS
0.56
Operating cash flow
$-68.49M
Free cash flow
$-78.79M
Fetching…
Sources
Revenue
$989.87M
Net income
$54.90M
Diluted EPS
0.54
Operating cash flow
$-44.71M
Free cash flow
$-47.88M
Fetching…
Sources
Revenue
$1.56B
Net income
$129.25M
Diluted EPS
1.28
Operating cash flow
$306.45M
Free cash flow
$302.55M
Fetching…
Sources
Revenue
$1.01B
Net income
$70.65M
Diluted EPS
0.70
Operating cash flow
$-204.97M
Free cash flow
$-222.53M
Fetching…
Sources
Is it cheap or expensive?
Fair value $78.51 vs current price $12.01
Our most-likely fair value is $78.51 a share — about 553.7% above today's price of $12.01, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Stretched
Net debt $1.6B. Interest coverage 8423.6x.
Net debt
$1.61B
Interest coverage
8,423.56x
Dream Finders Homes, Inc.'s profit covers its interest bill about 8423.6 times over. which is stronger than every peer shown here.
Stretched
Worse cushion
Baseline
Better cushion
DFH
BASELINE
Dream Finders Homes, Inc.
Total debt $1.82B Interest coverage 8,423.56x This is the baseline the peer rows are being compared against.
Total debt $68.71M Interest coverage 22.66x -100% vs DFH Carries about 371.7x less debt cushion than DFH.
What you should know
The case for and against DFH
3 Rewards
3 Risks
Rewards
-
Returns 9.4% on equity, ahead of 66% of its peers.
-
Free cash flow was positive in 4/10 years.
-
Trades at 8.5x P/E vs peer median 13.9x (38.5% cheaper).
Risks
-
Forward P/E (10.1x) is higher than trailing (8.5x) - earnings are expected to drop.
-
Net debt grew 118.9% over 3 years.
-
Stock trades 9.1% above its 5-year average P/E.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
8.52x
Forward P/E
10.14x
P/B
0.76x
P/S
0.26x
EV/EBITDA
14.42x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
20.0%
Operating margin
2.4%
Net margin
3.5%
ROE
9.4%
ROA
3.0%
Health
Liquidity and balance-sheet strength
Debt / equity
1.13x
Current ratio
7.59x
Quick ratio
0.53x
Total debt
$1.82B
Total cash
$203.49M
Growth
How the business has been compounding
Revenue TTM
$4.13B
Revenue 5Y CAGR
22.4%
EPS TTM
1.41
EPS 5Y CAGR
-4.4%
Cash flow
How much cash the business throws off
Operating CF TTM
$-138.45M
Free CF TTM
$-126.37M
FCF margin
-3.1%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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