TMHC vs DHI

For growth investors, Taylor Morrison Home Corporation (TMHC) is the stronger pick with -0.

6% revenue growth year-over-year, versus -6. 9% for D. R. Horton, Inc. (DHI). Taylor Morrison Home Corporation (TMHC) offers the better valuation at 7. 8x trailing P/E (11. 4x forward), making it the more compelling value choice. Analysts rate Taylor Morrison Home Corporation (TMHC) a "Buy" — based on 30 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, Taylor Morrison Home Corporation (TMHC) is the cheapest at 7.

8x versus D. R. Horton, Inc. at 12. 9x. On forward P/E, Taylor Morrison Home Corporation is actually cheaper at 11. 4x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: Taylor Morrison Home Corporation wins at 0. 35x versus D. R. Horton, Inc. 's 1. 12x — a PEG below 1. 0 traditionally signals the market is underpricing earnings growth.

Over the past 5 years, Taylor Morrison Home Corporation (TMHC) delivered a total return of +94.

4%, compared to +52. 9% for D. R. Horton, Inc. (DHI). Over 10 years, the gap is even starker: DHI returned +434. 6% versus TMHC's +338. 9%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), D.

R. Horton, Inc. (DHI) is the lower-risk stock at 0. 85β versus Taylor Morrison Home Corporation's 0. 92β — meaning TMHC is approximately 9% more volatile than DHI relative to the S&P 500. On balance sheet safety, D. R. Horton, Inc. (DHI) carries a lower debt/equity ratio of 24% versus 37% for Taylor Morrison Home Corporation — giving it more financial flexibility in a downturn.

By revenue growth (latest reported year), Taylor Morrison Home Corporation (TMHC) is pulling ahead at -0.

6% versus -6. 9% for D. R. Horton, Inc. (DHI). On earnings-per-share growth, the picture is similar: Taylor Morrison Home Corporation grew EPS -6. 0% year-over-year, compared to -19. 3% for D. R. Horton, Inc.. Over a 3-year CAGR, DHI leads at 0. 8% annualised revenue growth. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.

D.

R. Horton, Inc. (DHI) is the more profitable company, earning 10. 5% net margin versus 9. 6% for Taylor Morrison Home Corporation — meaning it keeps 10. 5% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: TMHC leads at 14. 0% versus 12. 9% for DHI. At the gross margin level — before operating expenses — DHI leads at 23. 7%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential.

By this metric, Taylor Morrison Home Corporation (TMHC) is the more undervalued stock at a PEG of 0. 35x versus D. R. Horton, Inc. 's 1. 12x. A PEG below 1. 0 is traditionally considered the threshold for growth-adjusted undervaluation. On forward earnings alone, Taylor Morrison Home Corporation (TMHC) trades at 11. 4x forward P/E versus 14. 0x for D. R. Horton, Inc. — 2. 6x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for TMHC: 22. 2% to $73. 75.

In this comparison, DHI (1.

1% yield) pays a dividend. TMHC does not pay a meaningful dividend and should not be held primarily for income.

For long-horizon retirement investors, D.

R. Horton, Inc. (DHI) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0. 85), 1. 1% yield, +434. 6% 10Y return). Both have compounded well over 10 years (DHI: +434. 6%, TMHC: +338. 9%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Consumer Cyclical sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both.

DHI pays a dividend while TMHC does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.