Overvalued Home Builders Face Earnings Hurdle
Pulte Group (PHM) ($19.34 vs. $18.61 on Dec. 19): Still has a buy rating and set a multi-year high at $19.80 on Jan. 9. The daily chart is positive but overbought with a positive but overbought weekly chart and with the five-week MMA at $18.13. My annual value level is $14.00 with a monthly pivot at $19.27 and weekly risky level at $20.09.
Ryland Group (RYL) ($38.31 vs. $37.39 on Dec. 19): Has been downgraded to hold from buy and set a multi-year high at $39.22 on Jan. 9. The daily chart has a negative divergence in momentum with a positive weekly chart and the five-week MMA at $35.97. My quarterly value level is $28.90 with a monthly pivot at $37.26 and a weekly risky level at $38.49.
Standard & Pacific (SPF) ($7.80 vs. $7.23 on Dec. 19): Still has a hold rating after setting a multi-year high at $8.08 on Jan. 9. The daily chart shows a negative divergence in momentum with a positive weekly chart profile and the five-week MMA at $7.30. My semiannual value level is $7.36 with a weekly pivot at $7.80 and monthly risky level at $8.00.
Toll Brothers (TOL) ($34.91 vs. $32.51 on Dec. 19): Still has a buy rating with the stock below its multi-year high of $37.08 set on Sept. 21. The daily chart profile is overbought with a positive weekly chart profile and the five-week MMA at $33.05. My annual value level is $31.95 with a weekly pivot at $33.79 and monthly risky level at $37.19.At the time of publication the author held no positions in any of the stocks mentioned. Follow @Suttmeier This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.
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