Consumer Discretionary
Despite forecasting a small miss (on the top line and bottom line) for 2Q23, Alex Barron remains bullish. There is underlying demand that should increase each year for another five years based purely on demographics. If i/r remain near current levels, supply is likely to remain restricted. If i/r were to come down, Alex thinks demand will increase substantially. TMHC has the highest upside among the top 10 builders, which remain attractively valued relative to historical valuation metrics and given they are stronger companies today with lower risk profile they should be trading at much higher multiples. TP $79 (60% upside).
Edition: 165
- 21 July, 2023