BUZZ-BofA lowers US homebuilder's PT on sluggish demand and policy uncertainty

Reuters
Oct 10
BUZZ-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

(Reporting by Parth Chandna)

((Parth.Chandna@thomsonreuters.com;))

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