Hovnanian (HOV) Valuation Stretched, 'Pare Positions' - Analyst
Yesterday Hovnanian Enterprises Inc. (NYSE: HOV) reported Q4 earnings that most viewed as better than expected. However, caution comments by its CEO created worry among some investors and shares traded lower.
Commenting on developments, MKM analyst Megan McGrath said, "we believe that management's somewhat cautious tone on fiscal 2013 disappointed investors. While we have raised our fair value estimate to $4, we believe that HOV's valuation has gotten somewhat ahead of itself and would recommend continuing to pare positions into the end of the year."
McGrath estimates HOV is now trading at 2.5x book value, the highest book value multiple of the major public homebuilders.
MKM Partners has a Neutral rating on Hovnanian Enterprises (NYSE: HOV) with a modified price target of $4.00 (from $3.25).
For an analyst ratings summary and ratings history on Hovnanian Enterprises click here. For more ratings news on Hovnanian Enterprises click here.
Shares of Hovnanian Enterprises closed at $5.20 yesterday, with a 52 week range of $1.27-$5.80.
Commenting on developments, MKM analyst Megan McGrath said, "we believe that management's somewhat cautious tone on fiscal 2013 disappointed investors. While we have raised our fair value estimate to $4, we believe that HOV's valuation has gotten somewhat ahead of itself and would recommend continuing to pare positions into the end of the year."
McGrath estimates HOV is now trading at 2.5x book value, the highest book value multiple of the major public homebuilders.
MKM Partners has a Neutral rating on Hovnanian Enterprises (NYSE: HOV) with a modified price target of $4.00 (from $3.25).
For an analyst ratings summary and ratings history on Hovnanian Enterprises click here. For more ratings news on Hovnanian Enterprises click here.
Shares of Hovnanian Enterprises closed at $5.20 yesterday, with a 52 week range of $1.27-$5.80.