Wells Fargo Securities Lowers Estimates on M.D.C Holdings (MDC)

Wells Fargo Securities is out with a research report this morning, where it lowers its estimates for M.D.C. Holdings Inc. MDC following the company’s most recent earnings report. The WFS analysts said that, given the success of some of its industry peers, they believe it’s hard for MDC to reach breakeven without aggressive cost cutting measures. Because of this, they believe the shares are much less likely to outperform. They also noted that the company's liquidity remains among the best in the group, however, supporting a slightly higher valuation. Their estimates for 2010 EPS went to ($1.05) from ($0.73) and our 2011E EPS go to ($0.65) from $0.00; the valuation range remains $28-$30. Wells Fargo values MDC at 1.5-1.6x FTME tangible book value per share.
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