Forestar Group reported lower earnings and revenue for both the fourth quarter and full fiscal 2026, despite selling slightly more lots in the final quarter. The residential lot developer also ended the year with a large portfolio of owned and controlled lots, substantial liquidity and relatively low net debt.
Fourth-quarter results
- For the quarter ended Sept. 30, net income fell 32% from a year earlier to $59.2 million, or $1.15 per diluted share. Pretax income declined 31% to $78.6 million.
- Revenue decreased 13% to $580.8 million. Forestar sold 5,004 lots, up 2% from 4,891 in the year-earlier quarter.
- The quarter’s pretax results included a $10 million gain on asset sales and $7.6 million in real estate impairment charges. A year earlier, the company recorded a $4.5 million asset-sale gain and no impairment charges.
- The pretax profit margin was 13.5%.
Full-year results and balance-sheet position
- Fiscal 2026 net income declined 15% to $142.6 million, or $2.78 per diluted share. Pretax income fell 12% to $192.1 million.
- Revenue was $1.6 billion, down 2% from $1.7 billion in fiscal 2025. Forestar sold 13,545 lots during the year. Its pretax profit margin was 11.7%, and return on equity was 7.8%.
- Full-year results included the same $10 million asset-sale gain and $7.6 million impairment charge reported in the fourth quarter. In fiscal 2025, the company recorded a $4.5 million asset-sale gain and no real estate impairment charges.
- Forestar ended the year owning or controlling 84,400 lots, with 21,500 lots contracted for sale. Its real estate totaled $2.5 billion.
- Book value per share rose 8% from a year earlier to $37.56.
- The company reported a 6.7% net debt-to-total-capital ratio and $1.3 billion in total liquidity.
The reported figures show earnings and revenue declined year over year, while fourth-quarter lot sales increased modestly. The year-end figures also indicate Forestar had a substantial lot position and liquidity relative to its reported net debt.