Hovnanian Enterprises (HOV) Stock Forecast & Price Target

Hovnanian Enterprises Inc. demonstrated significant improvement in its financial outlook as evidenced by an increase in pretax joint venture income estimates, rising from $7 million to $10 million. Additionally, the company successfully implemented price increases in approximately 20% of its communities, particularly in the Mid-Atlantic and Northeast markets, reflecting a strengthening demand. Order comparisons also showed positive momentum, with a year-over-year performance showing a 7% increase in July, following a 1% increase in June, highlighting a recovering market environment for the company.

Hovnanian Enterprises is projected to experience a sequential decline in book value from FY25 to FY26, attributed to an increase in the estimated share count for FY26 compared to FY25. Furthermore, the company's third-quarter fiscal 2025 gross margin fell short of expectations, and the outlook for the fourth quarter remains similarly bleak, indicating persistent challenges in maintaining profitability. Competitive pressures on gross margins have intensified more than anticipated during calendar year 2025, contributing to a deteriorating financial outlook for the company.