Ticonderoga on Homebuilding & Building Products: March Pending Home Sales - Better Than Expected
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Rating Summary:
13 Buy, 15 Hold, 9 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 7 | Down: 6 | New: 39
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Ticonderoga on Homebuilding & Building Products: March Pending Home Sales - Better Than Expected by Stephen East
East wrote, "The March Pending Home Sales Index rose 5.1% to 94.1 - This was well above the consensus looking for a 1.5% increase. We note February results were downwardly revised to 89.5 from 90.8. We believe the poor weather impact in February was the largest driver of the better performance in March. Also, given recent builder commentary on month-over-month order trends improvements, this data supports their comments. Due to mixed earnings releases today, we would expect a slight positive investor reaction to the data, but it will be generally overshadowed by earnings, in our view."
"By region, the important South increased 10.3% in March following a 2.3% gain in February - March results in the region were down 10.5% compared to last year due to the absence of the tax credit this year. At the current level, the index in the South is 21.1% above its post tax credit average. The West increased 3.1% to 103.7 on the heels of a 1.9% increase last month. On a year-over-year basis, the West is down 4.1%."
Some Homebuilder Stocks Include: Lennar (NYSE: LEN), PulteGroup (NYSE: PHM), MDC Holdings (NYSE: MDC), DR Horton (NYSE: DHI), Beazer Homes (NYSE: BZH), Hovnanian (NYSE: HOV) and Toll Bros. (NYSE: TOL).
East wrote, "The March Pending Home Sales Index rose 5.1% to 94.1 - This was well above the consensus looking for a 1.5% increase. We note February results were downwardly revised to 89.5 from 90.8. We believe the poor weather impact in February was the largest driver of the better performance in March. Also, given recent builder commentary on month-over-month order trends improvements, this data supports their comments. Due to mixed earnings releases today, we would expect a slight positive investor reaction to the data, but it will be generally overshadowed by earnings, in our view."
"By region, the important South increased 10.3% in March following a 2.3% gain in February - March results in the region were down 10.5% compared to last year due to the absence of the tax credit this year. At the current level, the index in the South is 21.1% above its post tax credit average. The West increased 3.1% to 103.7 on the heels of a 1.9% increase last month. On a year-over-year basis, the West is down 4.1%."
Some Homebuilder Stocks Include: Lennar (NYSE: LEN), PulteGroup (NYSE: PHM), MDC Holdings (NYSE: MDC), DR Horton (NYSE: DHI), Beazer Homes (NYSE: BZH), Hovnanian (NYSE: HOV) and Toll Bros. (NYSE: TOL).
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