D.R. Horton Inc (DHI) is slightly undervalued and Toll Brothers Inc (TOL) is undervalued.
Against our estimates of intrinsic value, TOL trades at the wider discount: a margin of safety of +35%, against +11% for DHI.
Values as of the 22 Sept 2026 close.
Discounting its cash flows at 10.2% (average of 3 methods) values the shares at $161.27; the price of $144.11 is 11% below that value, and 72% of that value comes from beyond year five.
Leak Score 67/100 on 8 of 12 signals
Discounting its cash flows at 10.0% (average of 3 methods) values the shares at $211.05; the price of $137.57 is 35% below that value, and 73% of that value comes from beyond year five.
Leak Score 84/100 on 3 of 12 signals
| Metric | DHI | TOL |
|---|---|---|
| Verdict | Slightly undervalued | Undervalued |
| Price | $144.11 | $137.57 |
| Intrinsic value | $161.27 | $211.05 |
| Margin of safety | +11% | +35% |
| Leak Score | 67/100 (8/12) | 84/100 (3/12) |
| Market cap | $40.3B | $12.7B |
| Revenue growth, 5 years | 11.0% | 9.2% |
| Operating margin | 12.1% | 14.4% |
| Net margin | 9.2% | 11.1% |
| Return on equity | 12.8% | 14.4% |
| Debt to equity | 0.30 | 0.34 |
| P/E | 13.7x | 11.1x |
| Forward P/E | 12.4x | 9.9x |
| P/B | 1.7x | 1.5x |
| Dividend yield | 1.2% | 0.8% |