UPDATE: JP Morgan Initiates Realogy Holdings at Overweight; Levered to Housing Recovery

JP Morgan initiated coverage on Realogy Holdings

with an Overweight rating and a $42 price target. JP Morgan noted, "We calculate that RLGY's EBITDA should increase by about $10 million for every percentage point growth in either existing home sales or average home prices. Furthermore, given the company's NOLs and above-average financial leverage, incremental EBITDA should drop to bottom-line cash flow. We think this set of dynamics makes RLGY among the most direct equity trades on the broad U.S. housing market." Realogy Holdings closed at $37.06 on Monday.