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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