Forestar Group Inc. (NYSE: FOR) announced impressive financial results for the fourth quarter and the full fiscal year 2025, significantly surpassing earnings expectations. The company reported earnings per share (EPS) of $1.70, while analysts had anticipated $1.17. Total revenue for the fourth quarter reached $670 million, contributing to a full-year revenue of $1.7 billion, marking a 10% increase compared to the previous year.
During the earnings call on October 28, 2025, Vice President of Finance and Investor Relations, Chris Hibbetts, introduced the session by noting the presence of forward-looking statements in compliance with the Private Securities Litigation Reform Act of 1995. He emphasized that these projections are subject to change based on market conditions and company performance.
President and CEO Anthony Oxley attributed the positive results to a strong operational model and dedicated team. Forestar’s annual revenue growth occurred despite challenges in new home demand driven by affordability constraints. The company successfully increased its book value per share to $34.78, reflecting an 11% rise from the previous year.
Over the past five years, Forestar has invested over $7.3 billion in land acquisition and development, delivering more than 75,000 finished lots to homebuilders across various markets. Oxley noted the company’s robust liquidity position, ending the year with $968 million available.
Financial Highlights and Market Strategy
Chief Financial Officer Jim Allen detailed the financial performance in his remarks. Net income for the fourth quarter was $87 million, a 7% increase year-on-year. For fiscal 2025, net income totaled $167.9 million, translating to $3.29 per diluted share. The revenue surge in the fourth quarter was attributed to $103.4 million in tract sales, with a total of 4,891 lots sold at an average price of $115,700.
Despite a gross profit margin decline to 22.3%, down from the previous year, the company remained focused on improving operational efficiency. Allen highlighted that the pretax profit margin for the quarter stood at 16.9%, with a total pretax income of $219.3 million for the year.
Oxley also emphasized the company’s commitment to strategic growth, including investments in land and development while maintaining a disciplined approach to managing costs. Forestar aims to deepen its partnerships with top customers, particularly D.R. Horton, which accounted for 15% of homes started on Forestar-developed lots in the past year.
Outlook and Future Investments
Looking ahead, Forestar plans to invest approximately $1.4 billion in land acquisition and development in fiscal 2026. The company expects to deliver between 14,000 and 15,000 lots, with anticipated revenue between $1.6 billion and $1.7 billion. Oxley acknowledged the expected challenges in home affordability but expressed confidence in long-term demand for finished lots.
The company is strategically positioned to navigate the current market landscape, with 99,800 lots in its inventory as of September 30, 2025. This includes 65,100 owned lots, of which 8,900 are finished and under contract. With strong liquidity and a competitive capital structure, Forestar is well-equipped to capitalize on emerging opportunities in the fragmented lot development market.
In closing, Oxley reiterated the determination of the Forestar team to maintain operational flexibility and market responsiveness in the upcoming fiscal year. The company looks forward to sharing further updates in January during the release of its first-quarter results.
