(Disclosure: Rose Law Group represents Taylor Morrison.)
By Vincent Salandro | Builder
Taylor Morrison outperformed expectations across all key metrics in the second quarter, driven by the benefits of the home builder’s scale, streamlined operations, and a balanced portfolio as well as improved housing market conditions.
“On the demand front, sales and shopper activity remained healthy throughout the quarter, maintaining the momentum that began in the early spring selling season,” Sheryl Palmer, chairman and CEO of Taylor Morrison, said during the home builder’s quarterly earnings call. “In total, our net sales orders increased 6% sequentially and 18% year over year, driven by a monthly absorption pace of 3.1 per community as compared to 2.9 in the first quarter and 2.6 a year ago.”
In the second quarter, Taylor Morrison closed 3,125 homes—a 3% year-over-year increase—at an average price of $639,000, which generated home closings revenue of $2 billion, well above analyst projections for the quarter. The company reported profits per share of $2.12, more than $0.40 per share above the consensus expectations for the second quarter.
Market performance was strongest in Taylor Morrison’s West region, led by Sacramento, California; Seattle; and Phoenix. The home builder’s Central region also “improved meaningfully” in the quarter, according to Palmer, while all markets in Taylor Morrison’s East region are experiencing healthy trends. Palmer said, moving forward, the home builder will target an annualized absorption rate in the low-3 range as compared with the company’s historical rate in the low- to mid-2s.
