Hovnanian Enterprises (HOV) Stock Forecast & Price Target

Hovnanian Enterprises Inc has demonstrated a positive financial trend, as reflected in the increased pretax joint venture income estimate, which was raised to $10 million from a previous estimate of $7 million. Additionally, the company achieved pricing increases in approximately 20% of its communities during the third fiscal quarter of 2025, primarily in the Mid-Atlantic and Northeast markets, indicating strong pricing power. Furthermore, order comparisons have shown improvement through the same period, with notable growth in July at 7% year-over-year, following a gradual recovery from a 4% decline in May and a 1% increase in June.

Hovnanian Enterprises faces a negative outlook primarily due to an anticipated sequential decline in book value from FY25 to FY26, attributed to an increase in the share count for FY26. Additionally, the company's gross margin for F3Q25 fell short of expectations, with further projections for F4Q25 also indicating subpar performance. The competitive pressures adversely impacting gross margins have proven to be more significant for Hovnanian than previously forecasted, further contributing to the unfavorable financial outlook.