Homebuilding Stocks Strong Following Citi's Upgrade Of KB, Ahead Of Home Sales Data
Shares of KB Home (NYSE: KBH) are leading stocks in the Homebuilding sector higher Monday morning; the stock is up 6.9 percent at last check.
Elsewhere in the sector, shares of PulteGroup (NYSE: PHM) are up 5 percent, Standard Pacific (NYSE: SPF) shares are up more than 4 percent, shares of Ryland (NYSE: RYL) are up 3.7 percent, Toll (NYSE: TOL) shares are up 3.6 percent, shares of Lennar (NYSE: LEN) are up 3.2 percent, and DR Horton (NYSE: DHI) share are up 2.8 percent.
The SPDR S&P Homebuilders ETF (NYSE: XHB) is up more than 2 percent at last check.
Investors in the Homebuilding group are suggesting strength is stemming from an earlier Citi note on KB Home in which the firm's Will Randow upgraded his investment recommendation on the stock from Sell to Neutral and boosted his price target from $13 to $17.
Randow cited KB earnings which are recovering and a continued belief sentiment has bottomed. The Citi analyst believes homebuilders will see a favorable impact from the spring selling season.
With shares of KB last trading at $18.13, Randow's new price target implies potential downside of about 6 percent.
Also potentially affecting the sector Monday, investors are awaiting new home sales data on December 24th and pending home sales on Friday. Both data points will be for the month of November.
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