Billionaire David Tepper is Dumping These 5 Stocks

4. D.R. Horton, Inc. (NYSE:DHI)

Number of Hedge Fund Holders: 52

D.R. Horton, Inc. (NYSE:DHI) is a homebuilding company operating in the United States. Billionaire David Tepper held 1.10 million shares of D.R. Horton, Inc. (NYSE:DHI) in the fourth quarter of 2021, worth $119.2 million, representing 3.06% of the total 13F portfolio. He exited his position completely in the first quarter of 2022. 

On July 22, JMP Securities analyst Aaron Hecht lowered the price target on D.R. Horton, Inc. (NYSE:DHI) to $95 from $120 and kept an Outperform rating on the shares. The analyst observed that although Q3 outperformance was supported by higher home prices and larger than anticipated margins, demand significantly dropped in June as interest rates soared. Lower buyer demand led to a FY23 guidance cut, though he still believes that monetizing backlogs will result in D.R. Horton, Inc. (NYSE:DHI) having top-notch corporate structures and normalized ROEs at the conclusion of this cycle, the analyst added.

Among the hedge funds tracked by Insider Monkey, John Armitage’s Egerton Capital Limited is the biggest stakeholder of D.R. Horton, Inc. (NYSE:DHI) as of Q1 2022, with 7.8 million shares worth $582.5 million. Overall, 52 hedge funds were bullish on the stock at the end of March, compared to 54 funds a quarter ago. 

Here is what Palm Valley Capital Fund has to say about D.R. Horton, Inc. (NYSE:DHI) in its Q2 2022 investor letter:

“Vidler Water was acquired by homebuilder D.R. Horton (NYSE:DHI) during the second quarter for $15.75 per share, a modest 19% premium to the 90-day volume weighted average price. D.R. Horton can use Vidler’s water rights to satisfy government requirements to have water resources available before it breaks ground on new housing developments in Nevada. The takeover price was below our valuation, but D.R. Horton was the only real buyer who stepped up to the plate for Vidler’s assets. The deal appears to have leaked early, since the stock surged in the weeks before the announcement.”