UPDATE: Goldman Sachs Adds M.D.C. Holdings to Conviction Buy List
In a report published Monday, the Goldman Sachs Group upgraded M.D.C. Holdings (NYSE: MDC) from Buy to Conviction List Buy and raised the price target from $34.00 to $50.00.
Goldman Sachs noted, “Our channel checks indicate that Denver, the company's largest market, is witnessing strong sales growth and pricing appreciation as the inventory supply is at its lowest levels in years. We expect MDC's very strong 1Q2012 order growth to continue through the rest of 2012, outpacing the peer group average. MDC is in the early to midstages of its operational turnaround as it continues to normalize SG&A costs (we expect annualized SG&A cuts of 16% on sales growth of 37 %). We believe this dual traction, created from an expanding top line and contracting expenses, to be the main driver of MDC's earnings out performance vs. peers.”
M.D.C. Holdings closed on Friday at $30.81.
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