UPDATE: Credit Suisse Initiates Standard Pacific at Outperform Order and Margin Growth

Credit Suisse initiated coverage on Standard Pacific

with an Outperform and an $8 price target. Credit Suisse noted, "Our Outperform rating is based on our expectation for superior earnings growth as SPF's significant investment in attractively-priced land drives higher margins and strong order growth in 2013 with acceleration in 2014. … We expect gross margins to rise from 20.4% in 2012 to 21.6% in 2013 and 22.7% in 2014, driven by improving home prices and a positive mix from recent land deals. We think SPF's disciplined approach, strong CA relationships, and willingness to take on larger, more complex development deals will allow for continued acquisitions at attractive returns vs. peers." Standard Pacific closed at $6.31 on Tuesday.