Overall the construction sector is no bargain as the sector is 13.2% overvalued according to www.ValuEngine.com. There are 160 stocks in the sector with only 11 buy rated stocks. Even after the upgrades I present this morning, we show 39 sell rated stocks and 29 strong sell rated stocks. With 42.5% of stocks in sell categories, but given the upgrades shown today, I rate the construction sector an underweight up from avoid-source of funds.
Reading the Table
OV/UN Valued: Stocks with a red number are undervalued by this percentage. Those with a black number are overvalued by that percentage according to ValuEngine.VE Rating: A "1-engine" rating is a strong sell, a "2-engine" rating is a sell, a "3-engine" rating is a hold, a "4-engine" rating is a buy and a "5-engine" rating is a strong buy. Last 12-Month Return (%): Stocks with a red number declined by that percentage over the last 12 months. Stocks with a black number increased by that percentage. Forecast 1-Year Return: Stocks with a red number are projected to decline by that percentage over the next 12 months. Stocks with a black number in the table are projected to move higher by that percentage over the next 12 months. Value Level: Price at which to enter a GTC limit order to buy on weakness. The letters mean; W-weekly, M-monthly, Q-quarterly, S-semiannual and A-annual. Pivot: A level between a value level and risky level that should be a magnet during the time frame noted. Risky Level: Price at which to enter a GTC limit order to sell on strength.
D R Horton (DHI) ($22.14 vs. $24.25 on March 19) has been upgraded to hold from sell. The multi-year high was set at $25.56 on March 20 giving investors the opportunity to book profits at my weekly risky level for that week at $25.02. The weekly chart shifted to negative on April 5 and stays negative with a close this week below the five-week modified moving average at $23.11. My semiannual value level is $20.50 with a quarterly pivot at $22.96 and monthly risky level at $25.56.
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