June 10, 1998
D.R. Horton Up 9%; Salomon
Smith Barney Reiterates Buy
Dow Jones Newswires
NEW YORK -- Shares of D.R. Horton Inc. (DHI)
gained 9% Wednesday after Salomon Smith Barney
reiterated a buy rating on the stock.
Saying the home-builder sector is trading at "practically
the lowest valuation level the group has seen in two
decades," analyst David Dwyer reiterated buy ratings on
Horton, Lennar Corp. (LEN), Toll Brothers Inc. (TOL)
and NVR Inc. (NVR).
In a research note, Dwyer said home-builder stocks
have pulled back an average of about 20% since April
on concerns about unsustainably strong order growth
and interest-rate fears.
Horton, a builder of single family homes, set its 52-week
high of 24 on April 22. The stock has lost ground since
then, closing at 18 1/16 Tuesday.
Shares of the Arlington, Texas, company finished
Wednesday at 19 11/16, up 1 5/8, or 9%, on volume of
1 million shares, compared with typical daily volume of
396,100 shares.
Though order comparisons will be difficult for the sector
through the first half of 1999, "strong backlogs will allow
the group to weather several months of flat to down
orders should comparisons turn negative next year,"
Dwyer said.
D.R. Horton Chief Financial Officer David Keller could
point to no specific developments to explain
Wednesday's gains, though he said the Salomon Smith
Barney note may have contributed to the rise.
- By Ted W. Kemp; 201-938-5392
Briefing Book for: DHI | LEN | NVR | TOL
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