Credit Suisse Lowers Expectations On Housing

Loading...
Loading...

In a note out Tuesday morning, Credit Suisse analyst Michael Dahl downgraded PulteGroup, Inc. PHM, Meritage Homes Corp MTH and Ryland Group Inc RYL to Underperform from Neutral, Taylor Morrison Home Corp TMHC to Neutral from Outperform, while upping NVR, Inc. NVR to Neutral from Underperform.

Dahl states that, "Despite the declines in the stocks we continue to see the dominant themes of 1) falling gross margins and 2) risk to Texas as creating downside risks to expectations, and as a result don't feel an urgency to own any builders at this time. We are reducing our order ests. to incorporate meaningful slowing in TX/oil-impacted markets with partial offsets elsewhere (better rates/affordability), and tweaking our already below-consensus margin ests. lower, resulting in EPS ests. 11% below consensus in '15 and 20% below in '16.The group still trades at 1.5x our YE'15 book value ests., typically doesn't perform well against falling ests. and often overshoots to the downside."

date
ticker
name
Price Target
Upside/Downside
Recommendation
Firm
Posted In: Analyst ColorUpgradesDowngradesAnalyst RatingsCredit SuisseMichael Dahl
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!

Loading...