BofA lowers US homebuilder's PT on sluggish demand and policy uncertainty
BofA lowers PT on multiple U.S. homebuilder's on sluggish demand and policy uncertainty; maintains ratings
Says homebuilders cannot solve affordability alone given the resale home market is much larger than new build (only 27% of inventory)
"Recent commentary suggests the administration will also examine supply solutions, which could have negative implications to homebuilder stocks," BofA says
Brokerage says housing affordability has hovered near the lowest level in history over the last three years as home prices (+45% since 2020) and mortgage rates (+418 bps) have surged
relative to incomes (+23%)
Following are the PTs:
Home Builders | New PT | Old PT |
Dream Finders Homes DFH.N | $26 | $30 |
D.R. Horton DHI.N | $165 | $175 |
KB Home KBH.N | $62 | $67 |
Lennar LEN.N | $125 | $133 |
Meritage Homes MTH.N | $80 | $85 |
NVR NVR.N | $9000 | $9100 |
PulteGroup PHM.N | $140 | $145 |
Smith Douglas Homes SDHC.N | $15 | $17 |
Taylor Morrison Home TMHC.N | $72 | $75 |
Toll Brothers TOL.N | $150 | $155 |
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