Hovnanian EnterprisesHOV +4.00%67 Gross Margin % is 14.75% as of Apr. 2026, which is 8% below its 10-year median of 16.11. GuruFocus rates HOV with a GF Score™ of 67/100 and a GF Value™ of $124.95 (Modestly Overvalued). The stock has 11 warning signs investors should review. Among 90 Homebuilding & Construction companies, Hovnanian Enterprises ranks worse than 86.67% on this metric.
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
Hovnanian Enterprises had a gross margin of 14.75% for the quarter that ended in Apr. 2026 => No sustainable competitive advantage
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
Hovnanian Enterprises Gross Margin % Related Terms
Hovnanian Enterprises Gross Margin % Historical Data
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The historical data trend for Hovnanian Enterprises's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Residential Construction subindustry, Hovnanian Enterprises's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Hovnanian Enterprises Gross Margin % vs Homebuilding & Construction Industry
For the Homebuilding & Construction industry and Consumer Cyclical sector, Hovnanian Enterprises's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Hovnanian Enterprises's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
Hovnanian Enterprises (HOV) has a Gross Margin % of 14.75% as of Apr. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on Hovnanian Enterprises and its competitors. This is near median its historical median of 16.11. Over the past decade, Hovnanian Enterprises' Gross Margin % has ranged from 13.04 to 22.02. According to the industry distribution chart, Hovnanian Enterprises ranks #78 out of 90 companies in the Homebuilding & Construction industry, placing it in the top 86.7%.
Is Hovnanian Enterprises' Gross Margin % too high?
Hovnanian Enterprises' current Gross Margin % of 14.75% is near median its 10-year median of 16.11. Over the past 10 years, this metric has ranged from a low of 13.04 to a high of 22.02. The Homebuilding & Construction industry median Gross Margin % is 21.34. Hovnanian Enterprises' value of 14.75% is 30.9% below this industry median. Based on the distribution chart, Hovnanian Enterprises ranks #78 out of 90 companies in the Homebuilding & Construction industry, which is in the bottom quartile relative to peers. Overall, Hovnanian Enterprises has a GF Score™ of 67/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Hovnanian Enterprises' Gross Margin % compare to BZH and LEGH?
According to the Homebuilding & Construction industry distribution chart, Hovnanian Enterprises ranks #78 out of 90 companies for Gross Margin %. This places Hovnanian Enterprises in the lower half of its industry. The industry median Gross Margin % is 21.34. Hovnanian Enterprises' value of 14.75% is 30.9% below this benchmark. Historically, Hovnanian Enterprises' own Gross Margin % has ranged from 13.04 to 22.02 over the past decade. While the company's 10-year median is 16.11 vs. the industry median of 21.34, Hovnanian Enterprises has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Gross Margin % for a Homebuilding & Construction company?
The median Gross Margin % among Homebuilding & Construction companies is 21.34, based on 90 companies in the industry. Companies in the top quartile (top 25%) have a Gross Margin % significantly above this median, while those in the bottom quartile fall well below. However, Gross Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Hovnanian Enterprises's current Gross Margin % of 14.75% is 30.9% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Gross Margin % mean?
A high Gross Margin % can signal that a stock is expensive relative to its fundamentals. Gross margin is the ratio of total gross profit to net sales. View historical data on Hovnanian Enterprises and its competitors. For the Homebuilding & Construction industry, the median Gross Margin % is 21.34 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Hovnanian Enterprises's current Gross Margin % is 14.75%, which is near median its own 10-year median of 16.11. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Hovnanian Enterprises stock overvalued right now?
Based on GuruFocus' analysis, Hovnanian Enterprises (HOV) is currently considered Modestly Overvalued. The stock's GF Value™ is $124.95, compared to a current price of $147.55 — trading 18.1% above its estimated fair value. The current Gross Margin % is 14.75%, which is near median its 10-year median of 16.11 and 30.9% below the Homebuilding & Construction industry median of 21.34. Hovnanian Enterprises' overall GF Score™ is 67/100 with 11 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Gross Margin % calculated?
Gross Margin % is calculated from a company's financial statements. For Hovnanian Enterprises (HOV), the current Gross Margin % is 14.75% as of Apr. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Hovnanian Enterprises (HOV) Overvalued in 2026?
Based on GuruFocus' analysis, Hovnanian Enterprises stock appears to be overvalued.
The current stock price of $147.55 is trading 18.1% above its estimated GF Value™ of $124.95.
GuruFocus considers Hovnanian Enterprises to be Modestly Overvalued.
Key valuation signals for HOV:
Gross Margin %: 14.75% (near median its 10-year median of 16.11)
GF Value™: $124.95 vs. price of $147.55 (18.1% above fair value)
Industry Position: 30.9% below the Homebuilding & Construction median (#78 of 90)
No single metric tells the full story. See the HOV stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Hovnanian Enterprises Inc conducts all of its homebuilding and financial services operations. The company designs, constructs, markets, and sells single-family detached homes, attached townhomes and condominiums, urban infill, and active lifestyle homes in planned residential developments. It has two distinct operations: homebuilding and financial services. Its homebuilding operations are divided geographically into three segments: Northeast, which includes Delaware, Maryland, New Jersey, Ohio, Pennsylvania, Virginia, and West Virginia; Southeast, which includes Florida, Georgia, and South Carolina; and West, which includes Arizona, California, and Texas. The firm generates maximum revenue from the West Segment.
67GF Score
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