D.R. Horton (DHI)

Risks

• The homebuilding, lot development and rental housing industries are cyclical and affected by changes in economic, real estate or other conditions that could adversely affect our business or financial results.
• Constriction of the credit and public capital markets could limit our ability to access capital and increase our costs of capital.
• Reductions in the availability of mortgage financing provided by government agencies, changes in government financing programs, a decrease in our ability to sell mortgage loans on attractive terms or an increase in mortgage interest rates could decrease our buyers’ ability to obtain financing and adversely affect our business or financial results.
• The risks associated with our land, lot and rental inventory could adversely affect our business or financial results.
• We cannot make any assurances that our growth strategies, acquisitions or investments will be successful or will not expose us to additional risks or other negative consequences.
• Our business and financial results could be adversely affected by significant inflation, higher interest rates or deflation.
• Supply shortages and other risks related to acquiring land, building materials and skilled labor could increase our costs and delay deliveries.
• Public health issues such as a major epidemic or pandemic could adversely affect our business or financial results.
• Our business and financial results could be adversely affected by weather conditions and natural disasters.
• Homebuilding is subject to home warranty and construction defect claims in the ordinary course of business that can be significant.
• A health and safety incident relating to our operations could be costly in terms of potential liability and reputational damage.
• We are required to obtain performance bonds, the unavailability of which could adversely affect our results of operations and cash flows.
• Increases in the costs of owning a home could prevent potential customers from buying our homes and adversely affect our business or financial results.
• Governmental regulations and environmental matters could increase the cost and limit the availability of our land development and homebuilding projects and adversely affect our business or financial results.
• Governmental regulation of our financial services operations could adversely affect our business or financial results.
• We operate in competitive industries, and competitive conditions could adversely affect our business or financial results.
• We have significant amounts of debt and may incur additional debt, which could affect our financial health and our ability to raise additional capital to fund our operations or potential acquisitions.
• Servicing our debt requires a significant amount of cash, and we or our subsidiaries may not have sufficient cash flow from our respective businesses to pay our substantial debt.
• The instruments governing our and our subsidiaries’ indebtedness impose certain restrictions on our and our subsidiaries’ business, and the ability of us and our subsidiaries to comply with related covenants, restrictions or limitations could adversely affect our and our subsidiaries’ financial condition or operating flexibility.
• Our access to capital and our ability to obtain additional financing could be affected by any downgrade of our debt ratings.
• The instruments governing our indebtedness contain change of control provisions which could affect the timing of repayment.
• Damage to our corporate reputation or brands from negative publicity could adversely affect our business, financial results and/or stock price.
• Our business could be adversely affected by the loss of key personnel.
• Our business could be negatively impacted as a result of actions by activist stockholders or others.
• Information technology failures, data security breaches, and the failure to satisfy privacy and data protection laws and regulations could harm our business.