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Forestar Group

FOR
54
Real Estate - Development · Real Estate
Price
$25.67
-0.02 (-0.08%)
Market Cap
$1.31B
Winston Score
54
Winston is curious
Mixed quality — meaningful strengths and weaknesses.
Data as of Oct 18, 2026 · filings through Jun 30, 2026

§How the score breaks down

Quality
Mixed
9/30
Growth
Mixed
8/20
Cash Flow
Exceptional
9/10
Stability
Exceptional
9/10
Valuation
Good
6/10
Ownership
Good
10/15
Dividends
Not counted
n/a

51 of 95 counted points = Winston Score 54. Pillars marked n/a do not apply to this company and are left out of the total.

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Share count rising — dilution

+3.9% over 4y

The company has issued more shares over this period, which dilutes each existing shareholder’s stake.

Diluted shares outstanding: 49.0M (2021) → 50.9M (2025)

§Winston Score History

The full picture

Forestar Group Inc. is a residential land development company based in the United States. It buys raw land, develops it into finished lots, and sells those lots to homebuilders. The company operates as a majority-owned subsidiary of D.R. Horton, the largest homebuilder in the United States by volume.

Forestar makes money by purchasing undeveloped land, installing roads and utilities, and then selling the prepared lots — primarily to D.R. Horton. This close relationship with D.R. Horton gives Forestar a reliable customer base but also makes it heavily dependent on one buyer. The company operates across many U.S. states, focusing on high-growth housing markets in the Sun Belt and Southeast. The main growth driver is continued demand for new housing, but rising interest rates and a slowdown in homebuilding activity are the key risks, since fewer homes being built means fewer lots being purchased.

Growth Profile

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+4.2% YoY

YoY Growth Rate

Slow revenue growth

EPS Growth

+7.7% YoY

YoY Growth Rate

Slow EPS growth

R&D Spend

$0/ year

0.0% of revenue

Below sector average (1%)

Research and development spending

Insider Activity

62.2%ownership

→ Flat

Insider ownership roughly steady over the past year

Cash Position

Cash flow positive

$395M cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Growth context

Forestar Group is growing revenue at 4% year-over-year. The Winston Score measures business quality today — these growth metrics show what could matter tomorrow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Profit per sale
Gross Margin
20.7%
Thin — 20.7% gross margin
Profit after running costs
Operating Margin
11.3%
Modest — 11.3% operating margin
Return on the money invested
ROCE
8.0%
Below par — 8.0% return on capital

ROIC between 5% and 15%. They earn 5 to 15 cents back per year on every dollar invested.

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Growth

Sales growth
Sales YoY
+11.8%
Steady sales growth (+11.8% YoY)
Profit growth
EPS YoY
+4.4%
Modest earnings growth (+4.4% YoY)

Single-digit earnings growth — steady but not exciting.

How steady the profit is
EPS Consistency
4/8 quarters
Earnings inconsistent quarter-to-quarter

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Cash Flow

Profit that turns into cash
Cash Conversion
167%
Turns 167% of profit into real cash
Spare cash per sale
FCF Margin
16.4%
Converts sales into free cash efficiently (16.4%)

FCF margin between 10% and 20%. Every $100 in sales becomes $10 to $20 in real cash.

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Stability

What it owes vs what it owns
Debt / Equity
0.44
Conservative — low debt load (0.44)
Covers its interest
Interest Cover
100.00x
—
Comfortably covers interest (100.0x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

Price vs profit
P/E Ratio (TTM)
7.7x
Attractive valuation — P/E 7.7

P/E under 10. The price tag is small relative to last year's profit.

Cheaper or dearer next year
P/E vs Forward
-1.2
SLOWING
Earnings expected to fall — forward P/E higher than today

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Dividends

Not applicable for this business.
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