Is D.R. Horton Inc. (DHI) Among The Stocks That Could Surge From LA Wildfires Recovery Efforts?

We recently compiled a list of the 7 Stocks That Could Surge From LA Wildfires Recovery Efforts. In this article, we are going to take a look at where D.R. Horton Inc. (NYSE:DHI) stands against the other stocks.

Los Angeles wildfires continue to wreak havoc in the region, taking precious lives and destroying thousands of homes. The LA County Sheriff announced that nearly 10,000 structures were lost in the wildfires, but this number has already gone up and is expected to rise further as the authorities struggle to contain the fires.

Once the dust settles, there will be a huge demand for reconstruction of properties destroyed in the wildfires. The Biden administration has already promised federal reimbursements for the recovery efforts going on. Homebuilders could possibly benefit from this government support and the resulting spending surge as well.

To come up with the list of 7 stocks that could surge from LA wildfire recovery efforts, we considered stocks with a market cap of at least $4 billion.

A construction site of a multi-family residential complex, a modern urban skyline in the background.

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

D.R. Horton focuses on providing affordable homes to its customers, a segment that has experienced impressive growth lately. As the LA wildfires continue to rage, affordable homes could become a focus for both the government and the public. Apart from this, the company also has a diversified portfolio, with operations ranging from rentals to its subsidiary Forestar.

The company’s 2025 estimates are interesting to look at. Despite a rise in the number of households that the company could sell this year, its revenue is expected to decline. This could be due to the company’s other business segments, or lower house prices. The increase in demand post-LA wildfire recovery could help the company plug this gap, allowing it to continue its growth path.

The stock’s downward trajectory since October is for good reason. Its earnings are declining and so is its revenue. However, at the considerable discount that the price now offers, the stock could bottom out soon. That’s when catalysts like the interest rates and improving housing prospects for 2025 could kickstart the next rally.

Overall DHI ranks 1st on our list of the stocks that could surge from LA wildfires recovery efforts. While we acknowledge the potential of DHI as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as DHI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.