Validea Motley Fool Strategy Daily Upgrade Report - 10/24/2024
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 24 2024
0mins
Source: NASDAQ.COM
Stock Ratings Update: Validea's Small-Cap Growth Investor model, based on Motley Fool's strategy, has upgraded ratings for Stride Inc. (from 65% to 72%), NorthEast Community Bancorp Inc. (from 87% to 93%), and Taylor Morrison Home Corp. (from 52% to 72%), indicating varying levels of interest in these stocks based on their fundamentals and valuations.
Company Descriptions: Stride Inc. provides online educational services, NorthEast Community Bancorp focuses on construction and personal loans, while Taylor Morrison is involved in residential homebuilding and community development across the U.S., each catering to specific market needs.
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Analyst Views on TMHC
Wall Street analysts forecast TMHC stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for TMHC is 77.80 USD with a low forecast of 62.00 USD and a high forecast of 95.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
5 Analyst Rating
5 Buy
0 Hold
0 Sell
Strong Buy
Current: 61.550
Low
62.00
Averages
77.80
High
95.00
Current: 61.550
Low
62.00
Averages
77.80
High
95.00
About TMHC
Taylor Morrison Home Corporation is a homebuilder and developer. The Company's principal business is residential homebuilding and the development of lifestyle communities with operations across 12 states. The Company provides an assortment of homes across a range of price points to appeal to an array of consumer groups. It designs, builds and sells single and multi-family detached and attached homes in traditionally high growth markets for entry level, move-up, and resort lifestyle buyers. It operates under various brand names, including Taylor Morrison, Darling Homes Collection by Taylor Morrison, and Esplanade. It also has a Build-to-Rent homebuilding business which operates under the Yardly brand name. It owns and operates commercial space, retail, and multi-family properties under the Urban Form brand name. The Company, through its subsidiaries, provides financial services and title services. The Company, through its insurance agency, provides homeowner’s insurance policies.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Meritage Homes (MTH) and Taylor Morrison (TMHC) Downgraded to Neutral by BofA on 2026 Earnings Risks
- Rating Downgrade: BofA Securities downgraded Meritage Homes and Taylor Morrison Home from Buy to Neutral due to downside risks to 2026 earnings, reflecting a cautious outlook on the industry's future.
- Market Performance: Despite homebuilder stocks rallying 13% year-to-date, significantly outperforming the S&P 500's 1%, analysts highlight that weak employment and migration trends, along with ongoing inflation, will pressure fundamentals.
- Earnings Forecast Adjustment: BofA expects a decline in return on equity across most builders and has reduced its 2026 EPS estimates by 6%, indicating a conservative outlook on gross margins, particularly for Meritage due to higher land cost pressures.
- Intensified Competition: Analysts believe that while upcoming housing policy announcements may improve market sentiment, lower mortgage rates are unlikely to significantly boost entry-level demand, potentially increasing resale inventory and intensifying competition for new home sales.
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TMHC Stock Analysis: 52-Week Low at $51.895 with Current Price at $63.25
- Stock Fluctuation: TMHC's 52-week low stands at $51.895, with a high of $72.50, while the last trade was at $63.25, indicating stability within its trading range that aids investors in assessing market performance.
- Market Trend: The current price of $63.25 is approximately 87.2% of the 52-week high, suggesting sustained market confidence in TMHC, which may attract more investor interest in its future performance.
- Technical Indicators: TMHC's stock price has crossed above the 200-day moving average, potentially signaling a bullish trend in the short term, enhancing investor expectations regarding its growth potential.
- Investor Sentiment: Despite market fluctuations, TMHC's stock performance remains within a reasonable range, reflecting investor confidence in the company's fundamentals, which could influence future capital inflows.
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