What Happened?
Shares of homebuilder D.R. Horton (NYSE: DHI) jumped 3.7% in the morning session after famed investor Warren Buffett's holding company, Berkshire Hathaway, revealed a new stake in the homebuilder, signaling confidence in the housing market. According to filings, Warren Buffett's Berkshire Hathaway purchased a new stake in the Arlington, Texas-based homebuilder. The investment from the legendary investor is being interpreted as a strong vote of confidence in D.R. Horton and a sign that the U.S. housing market may have weathered its recent challenges. This news signals to the market that Buffett, a famed investor, might believe the worst is over for the sector. The move also highlights broader institutional confidence, as other firms have also recently increased their shareholdings in the company.
After the initial pop the shares cooled down to $166.90, up 1.8% from previous close.
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What Is The Market Telling Us
D.R. Horton’s shares are not very volatile and have only had 8 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The previous big move we wrote about was 1 day ago when the stock dropped 3.6% on the news that an unexpectedly sharp rise in wholesale inflation fueled concerns about rising costs and their impact on corporate profits. The primary catalyst was the July 2025 Producer Price Index (PPI), a measure of inflation at the wholesale level, which jumped 0.9% against forecasts of a 0.2% rise. This represents the most significant monthly increase in over three years, pointing to mounting cost pressures for manufacturers, with tariffs cited as a key factor. This data complicates the Federal Reserve's upcoming interest rate decisions, as persistent inflation may prevent rate cuts, creating a headwind for cyclical sectors like Industrials.
D.R. Horton is up 21.3% since the beginning of the year, but at $166.90 per share, it is still trading 15.3% below its 52-week high of $197.06 from September 2024. Investors who bought $1,000 worth of D.R. Horton’s shares 5 years ago would now be looking at an investment worth $2,276.
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