Investing.com -- Shares in D.R. Horton Inc (BVMF:D1HI34) shed 14% of their value in early US trading on Tuesday after the home construction company missed fourth-quarter estimates on both the top and bottom lines and issued weak guidance for its 2025 fiscal year.

For the fourth quarter, the company posted earnings per share of $3.92, short of analyst expectations at $4.18. Revenue came in at $10 billion, also below the consensus forecast of $10.21 billion.

Net sales orders totaled $7.15 billion, down 2.1% versus the prior year and below Wall Street projections of $7.52 billion. D.R. Horton reported a backlog of $4.77 billion, marking a 19% decline year-over-year. Estimates had placed the figure at $4.97 billion.

"We [...] see results as a broad negative read for builder stocks which could dent investor sentiment," analysts at RBC Capital Markets said in a note to clients.

For fiscal year 2025, D.R. Horton expects revenue between $36 billion and $37.5 billion, under the analyst consensus of $39.41 billion.

"Despite continued affordability challenges and competitive market conditions, our net sales orders in the fourth quarter increased slightly from the prior year to 19,035 homes,” said David Auld, Executive Chairman of D.R. Horton.

“Our sales pace was in line with normal seasonality from the third to fourth quarter but was below our expectations. While mortgage rates have decreased from their highs earlier this year, many potential homebuyers expect rates to be lower in 2025. We believe that rate volatility and uncertainty are causing some buyers to stay on the sidelines in the near term.”

“To help spur demand and address affordability, we are continuing to use incentives such as mortgage rate buydowns, and we have continued to start and sell more of our homes with smaller floor plans.”

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