U.S. Housing Market Heats Up Again
We had some unexpectedly good news on the housing front today with the release of the latest sales figures. For May, sales rose to the third highest level since the 20088 housing crisis and the median price of those homes hit an all-time record.
Analysts had expected a decline for the month, but they missed the mark as home sales increase just more than one percent. At a seasonally-adjusted rate, the US saw the sale of 5.62 million homes in May.
Supply has tightened, and that lower supply in the face of strong demand has caused prices to rise. In addition, mortgage-rates remain relatively low despite the recent Fed tightening.
Below, we present the latest data on Construction stocks. We applied some basic liquidity criteria--share price greater than $3 and average daily volume in excess of 100k shares.
Top-Five Construction Stocks--Short-Term Forecast Returns
|
Ticker |
Name |
Mkt Price |
Valuation (%) |
Last 12-M Return (%) |
|
M/I HOMES INC |
27.79 |
10.82% |
52.11% |
|
|
CENTURY COMMUNT |
25 |
16.44% |
40.13% |
|
|
UTD RENTALS INC |
103.91 |
1.40% |
50.92% |
|
|
TAYLOR MORRISON |
24.4 |
24.89% |
55.41% |
|
|
MDC HLDGS |
35.18 |
15.42% |
54.23% |
Top-Five Construction Stocks--Momentum
|
Ticker |
Name |
Mkt Price |
Valuation (%) |
Last 12-M Return (%) |
|
WILLDAN GROUP |
30.6 |
82.93% |
188.41% |
|
|
STERLING CONSTR |
10.69 |
31.81% |
108.38% |
|
|
MASTEC INC |
44.45 |
8.19% |
88.51% |
|
|
BEAZER HOMES |
13.09 |
-19.19% |
70.22% |
|
|
THOR INDS INC |
105.43 |
1.25% |
63.58% |
Top-Five Construction Stocks--Composite Score
|
Ticker |
Name |
Mkt Price |
Valuation (%) |
Last 12-M Return (%) |
|
CEMEX SA ADR |
9.02 |
-31.26% |
44.10% |
|
|
UTD RENTALS INC |
103.91 |
1.40% |
50.92% |
|
|
THOR INDS INC |
105.43 |
1.25% |
63.58% |
|
|
PULTE GROUP ONC |
24.23 |
0.45% |
26.93% |
|
|
TOLL BROTHERS |
39.02 |
4.48% |
40.56% |
Top-Five Construction Stocks--Most Overvalued
|
Ticker |
Name |
Mkt Price |
Valuation (%) |
Last 12-M Return (%) |
|
WILLDAN GROUP |
30.6 |
82.93% |
188.41% |
|
|
INSTALLED BUILD |
53.8 |
66.92% |
56.08% |
|
|
STERLING CONSTR |
10.69 |
31.81% |
108.38% |
|
|
AAON INC |
36.85 |
26.55% |
40.54% |
|
|
TAYLOR MORRISON |
24.4 |
24.89% |
55.41% |
Our top-ranked construction stock today is M/I Homes, Inc. (MHO). M/I Homes is one of the nation's leading builders of single-family homes. Their homes are marketed and sold under the trade names M/I Homes and Showcase Homes. They have homebuilding operations in Columbus and Cincinnati, Ohio; Indianapolis, Indiana; Tampa, Orlando and Palm Beach County, Florida; Charlotte and Raleigh, North Carolina; Virginia and Maryland.
Recommendation: We continue our STRONG BUY recommendation on M/I Homes, Inc. for 2017-06-20. Based on the information we have gathered and our resulting research, we feel that M/I Homes, Inc. has the probability of outperforming average market performance for the next year. The company exhibits ATTRACTIVE P/E Ratio and Price Sales Ratio.
|
ValuEngine Forecast |
||
|
Target |
Expected |
|
|---|---|---|
|
1-Month |
28.11 | 1.15% |
|
3-Month |
28.06 | 0.99% |
|
6-Month |
29.18 | 5.00% |
|
1-Year |
31.63 | 13.83% |
|
2-Year |
32.13 | 15.62% |
|
3-Year |
33.75 | 21.44% |
|
Valuation & Rankings |
|||
|
Valuation |
10.82% overvalued |
Valuation Rank |
 36 |
|
1-M Forecast Return |
1.15% |
1-M Forecast Return Rank |
99 |
|
12-M Return |
52.11% |
Momentum Rank |
87 |
|
Sharpe Ratio |
0.42 |
Sharpe Ratio Rank |
71 |
|
5-Y Avg Annual Return |
12.59% |
5-Y Avg Annual Rtn Rank |
75 |
|
Volatility |
29.93% |
Volatility Rank |
52 |
|
Expected EPS Growth |
23.24% |
EPS Growth Rank |
59 |
|
Market Cap (billions) |
0.68 |
Size Rank |
57 |
|
Trailing P/E Ratio |
11.07 |
Trailing P/E Rank |
90 |
|
Forward P/E Ratio |
8.98 |
Forward P/E Ratio Rank |
88 |
|
PEG Ratio |
0.48 |
PEG Ratio Rank |
60 |
|
Price/Sales |
0.38 |
Price/Sales Rank |
88 |
|
Market/Book |
1.01 |
Market/Book Rank |
79 |
|
Beta |
1.23 |
Beta Rank |
27 |
|
Alpha |
0.23 |
Alpha Rank |
83 |
Disclosure: None.
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