UPDATE: Sterne Agee Initiates Coverage on Realogy Holdings Corp. with Neutral Rating, $45 PT as Housing Optimism is Reflected in Valuation

In a report published Wednesday, Sterne Agee analyst Kenneth James initiated coverage on Realogy Holdings Corp. RLGY with a Neutral rating and $45.00 price target. In the report, Sterne Agee noted, “We are initiating coverage with a Neutral rating as we view current earnings expectations and the valuation as reflecting a consensus outlook of moderately higher existing home sales/prices, and resulting margin expansion, over the next two years. Our DCF analysis indicates shares trade near fair value on this scenario while our sensitivity analysis indicates existing home sales would have to exceed economists' forecast by 8-10% to drive 15-20% upside to current EPS expectations.” Realogy Holdings Corp. closed on Tuesday at $42.59.