For Immediate Release
Chicago, IL – December 11, 2012 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Toll Brothers Inc. (TOL), PulteGroup, Inc. (PHM), KB Home (KBH), The Home Depot, Inc. (HD) and Lennar Corp. (LEN).
Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513
Here are highlights from Monday’s Analyst Blog:
Is Housing Ahead of Itself?
For all its optimism, housing is still in a fragile recovery. Many millions of homeowners have more outstanding on their mortgages than what their houses are worth. Then, with banks still shy to lend, the Federal Government and its housing agencies back the vast majority of home loans. Further, the unemployment rate remains relatively high, negatively impacting home sales.
Our perusal of Zacks’ outstanding recommendations for the sector reveals that we are currently Neutral on major housing stocks pending a more broad-based recovery.
Toll Brothers Inc. (TOL), the nation’s biggest luxury homebuilder, recently reported a series of favorable metrics, including lower proportion of cancellations, higher number of inked contracts and rising backlog. The stock price is up 50.7% year to date, compared with a 12.8% return for the S&P 500.
The third quarter 2012 adjusted earnings of PulteGroup, Inc. (PHM) of 27 cents per share beat the Zacks Consensus Estimate of 20 cents by 35% and were significantly better than adjusted earnings of 11 cents in the prior-year quarter. PulteGroup’s cost reduction and operating efficiency improvement initiatives led to the bottom-line beat in the quarter. The company’s homebuilding revenues rose 13.5% to $1.26 billion, driven by an increase in number of homes closed and higher average selling prices. We are currently Neutral on the stock. The stock is up 160.7% year to date.
KB Home’s (KBH) adjusted net loss per share of 10 cents in the fiscal third quarter (ending August) was narrower than the prior-year quarter loss of 13 cents and the Zacks Consensus Estimate of a loss of 17 cents. Top-line growth of 16% and margin expansion led to the reduced loss. KB Home believes its strategic initiatives including overhead reduction, margin expansion, and land investments in higher-priced, better-located communities, coupled with an increasing backlog, will help it achieve profitability in the fiscal fourth quarter and beyond. We are currently Neutral on the stock. The stock is up 118.7% year to date.
Earnings of $1.01 per share of The Home Depot, Inc. (HD) for fiscal second-quarter (ending July) exceeded the Zacks Consensus Estimate of 97 cents and surged over 17% from the prior-year period, on the back of healthy comps growth and effective cost management. Further, strong quarterly performance prompted management to raise fiscal 2012 earnings guidance to $2.95 per share from $2.90 forecast earlier. We are currently Neutral on the stock. The stock is up 56.7% year to date.
Lennar Corp.’s (LEN) fiscal third quarter (ending August) earnings per share of 34 cents soared 209% from the year-ago earnings banking on solid top-line and margin growth. Earnings beat the Zacks Consensus Estimate by 25.9%. Revenue climbed 34% in the quarter as Lennar benefited from pricing and volume growth. The company witnessed solid year-over-year growth in new home orders, average selling prices and home closings in all the three quarters of 2012. Margins have also been above average, despite rising costs, driven by strong operating leverage. Lennar appears to be well positioned for growth for the rest of the fiscal year. We are currently Neutral on Lennar. The stock is up 87.8% year to date.
Lingering memories of the housing boom and bust make us view the attractiveness of the housing sector with caution. On the other hand, we believe that the above-mentioned surviving companies of the downturn may be well placed to benefit from a more sustained recovery.
Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leon Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=5518.
Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Follow us on Twitter: https://twitter.com/zacksresearch
Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
Zacks Investment Research
800-767-3771 ext. 9339
More From Zacks.com