D.R. Horton, Martha Stewart, DineEquity Get Upgrades
Shares of D.R. Horton were upgraded to buy from hold by TheStreet Ratings on Monday.
"DHI expects mid-16% gross margins in 2012 to persist until the fundamentals of job and home prices drive margins higher," KeyBanc Capital Markets analysts wrote in a Jan. 30 report. "DHI remains very active blending in new lots, with its 22,000 owned finished lots (23,000 finished optioned), 21,000 partially finished and 43,000 mothballed units, awaiting the housing recovery. DHI expects to develop 27,000 lots over the next 12-18 months, implying 6,000 incremental lots from options that will be developed."
D.R. Horton has an estimated price-to-earnings ratio for next year of 17.24 times; the average for home construction companies is 20.66. For comparison, both Lennar(LEN) and Toll Brothers (TOL) have higher forward P/Es of 17.8 and 31.9, respectively.
Fifteen of the 22 analysts who cover D.R. Horton rated it hold. Five analysts gave the stock a buy rating and two rated it sell.
TheStreet Ratings gives D.R. Horton a B- grade and a $17.33 price target. The stock closed Friday at $13.93 and has risen 10.47% year to date.
Martha Stewart Living Omnimedia
The media and merchandising company reported last week fourth-quarter earnings of $4.2 million, or 7 cents a share, up slightly from year-ago earnings of $4.1 million, or 7 cents.
Shares of Martha Stewart Living Omnimedia were upgraded to hold from sell by TheStreet Ratings .
Martha Stewart Living Omnimedia has a forward P/E of 12.21; the average for publishing companies is 21.88. For comparison, Scholastic(SCHL) and WebMD Health (WBMD) both have higher forward P/Es of 12.8 and 36.31, respectively.
Analysts were divided on Martha Stewart Living Omnimedia with two rating the stock buy, another two giving it a hold rating and one rating it sell.
Martha Stewart Living Omnimedia gets a C grade and hold rating from TheStreet Ratings . The stock closed Friday at $4.15 and has fallen 5.68% year to date.
The restaurant chain reported on March 1 fourth-quarter earnings of $27.3 million, or $1.55 a share, a swing from a year-earlier loss of $58.1 million, or $3.33..
Shares of DineEquity were upgraded to buy from hold by TheStreet Ratings .
"We believe shares hold the potential for 30%+ appreciation in 2012 driven by its attractive franchised model (mitigating inflation pressures), high FCF, ongoing balance sheet de-leverage, and an attractive valuation," Morgan Keegan analysts wrote in a Jan. 5 report.
DineEquity has a forward P/E of 11.71; the average for restaurant and bar companies is 19.12. For comparison, both Cheesecake(CAKE) and Cracker Barrel (CBRL) have higher forward P/Es of 13.87 and 11.76, respectively.