Housing

Stern Agee Remains Very Bullish as Housing Data Keeps Rising

The housing data keeps rolling in stronger and stronger for the U.S. economy. What is at issue is whether investors should keep paying up and up for housing stocks. Rather than “Buy low and sell high” we are getting to see a “Buy high, sell higher” call.

Sterne Agee’s Jay McCanless has reviewed this month’s home builders data and he remains positive on the group. He believes that investors should continue buying D.R. Horton Inc. (NYSE: DHI), Ryland Group Inc. (NYSE: RYL) and Meritage Homes Corp. (NYSE: MTH), because he believes the builders’ pricing power will increase in 2013.

McCanless sees competitive housing supply continuing to decline. Another boost comes from inventory shortages likely limiting sales in certain metropolitan areas and acting as a boost for the home builders mentioned.

McCanless said:

Our takeaway from this month’s data is to continue buying these three names because the fundamental backdrop remains positive. We believe builders’ pricing power can increase in 2013 as competitive supply comes off the market, and we estimate the risks of upside EPS surprises from pricing power and available inventory outweigh the risks of a downside EPS surprise in the current environment.

D.R. Horton Inc. (NYSE: DHI) is up 0.8%, at $24.67 with a 52-week range of $13.80 to $25.56.

The Ryland Group (NYSE: RYL) is up 1%. at $42.22 against a 52-week range of $17.18 to $43.00.

Meritage Homes Corp. (NYSE: MTH) is up the most of these three home builders, with a gain of 1.3% to $47.97, against a 52-week range of $24.31 to $48.62.

Read also: UBS Has Very Unusual List of Housing Market Winners

The #1 Thing to Do Before You Claim Social Security (Sponsor)

Choosing the right (or wrong) time to claim Social Security can dramatically change your retirement. So, before making one of the biggest decisions of your financial life, it’s a smart idea to get an extra set of eyes on your complete financial situation.

A financial advisor can help you decide the right Social Security option for you and your family. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you.

Click here to match with up to 3 financial pros who would be excited to help you optimize your Social Security outcomes.

 

Have questions about retirement or personal finance? Email us at [email protected]!

By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.

By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.