Smith Douglas Homes Corp. (NYSE:SDHC) Given Average Recommendation of "Reduce" by Analysts

Key Points

• Smith Douglas Homes Corp. (NYSE:SDHC) has received a consensus recommendation of "Reduce" from five research firms, with one analyst issuing a sell rating and four issuing hold ratings.
• The average one-year price target for the stock is $18.90, with recent target price adjustments from various firms ranging from $16.00 to $20.00.
• Smith Douglas Homes recently authorized a $50 million share buyback plan, allowing the company to repurchase up to 5.1% of its shares, suggesting potential undervaluation according to its board.

Shares of Smith Douglas Homes Corp. (NYSE:SDHC - Get Free Report) have been given an average rating of "Reduce" by the five research firms that are presently covering the firm, Marketbeat Ratings reports. One investment analyst has rated the stock with a sell recommendation and four have given a hold recommendation to the company. The average 1-year target price among analysts that have covered the stock in the last year is $18.90.

Several equities research analysts have recently commented on the company. Wells Fargo & Company cut their price objective on Smith Douglas Homes from $21.00 to $20.00 and set an "equal weight" rating for the company in a report on Monday, April 14th. Royal Bank Of Canada set a $16.00 price target on Smith Douglas Homes and gave the company a "sector perform" rating in a research note on Tuesday, May 20th. Wedbush restated a "neutral" rating and issued a $18.00 price target on shares of Smith Douglas Homes in a research note on Wednesday, May 14th. JPMorgan Chase & Co. dropped their price target on Smith Douglas Homes from $24.00 to $18.50 and set a "neutral" rating on the stock in a research note on Wednesday, May 21st. Finally, Wall Street Zen cut Smith Douglas Homes from a "hold" rating to a "sell" rating in a research note on Saturday.

Smith Douglas Homes Stock Down 1.8%

Shares of NYSE SDHC traded down $0.34 during trading hours on Friday, hitting $18.43. The company had a trading volume of 41,436 shares, compared to its average volume of 62,584. The stock has a market capitalization of $947.85 million, a P/E ratio of 11.59, a price-to-earnings-growth ratio of 10.07 and a beta of 1.05. Smith Douglas Homes has a 1-year low of $16.28 and a 1-year high of $39.50. The firm's 50 day moving average is $19.58 and its 200-day moving average is $20.15.

Smith Douglas Homes (NYSE:SDHC - Get Free Report) last released its quarterly earnings data on Wednesday, August 6th. The company reported ($0.13) EPS for the quarter, missing the consensus estimate of $0.25 by ($0.38). The company had revenue of $223.92 million during the quarter, compared to analyst estimates of $216.01 million. Smith Douglas Homes had a net margin of 1.43% and a return on equity of 1.74%. On average, sell-side analysts predict that Smith Douglas Homes will post 1.73 earnings per share for the current year.

Smith Douglas Homes declared that its board has authorized a stock repurchase program on Wednesday, May 28th that permits the company to buyback $50.00 million in outstanding shares. This buyback authorization permits the company to reacquire up to 5.1% of its stock through open market purchases. Stock buyback programs are often a sign that the company's board of directors believes its shares are undervalued.

Insider Transactions at Smith Douglas Homes

In other news, Director Neill B. Faucett acquired 7,000 shares of the stock in a transaction on Friday, May 23rd. The shares were purchased at an average price of $17.36 per share, for a total transaction of $121,520.00. Following the transaction, the director directly owned 14,505 shares of the company's stock, valued at approximately $251,806.80. This represents a 93.27% increase in their ownership of the stock. The acquisition was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, Director Jeffrey T. Jackson acquired 6,000 shares of the stock in a transaction on Friday, May 16th. The shares were purchased at an average price of $18.49 per share, for a total transaction of $110,940.00. Following the transaction, the director directly owned 25,682 shares in the company, valued at approximately $474,860.18. This trade represents a 30.48% increase in their ownership of the stock. The disclosure for this purchase can be found here. Insiders have bought 40,652 shares of company stock worth $748,964 over the last quarter.

Institutional Inflows and Outflows

Hedge funds have recently modified their holdings of the stock. Geode Capital Management LLC boosted its stake in shares of Smith Douglas Homes by 0.5% during the fourth quarter. Geode Capital Management LLC now owns 90,038 shares of the company's stock valued at $2,310,000 after purchasing an additional 457 shares in the last quarter. M&T Bank Corp increased its holdings in Smith Douglas Homes by 8.4% in the first quarter. M&T Bank Corp now owns 11,001 shares of the company's stock worth $215,000 after purchasing an additional 848 shares in the last quarter. PDT Partners LLC increased its holdings in Smith Douglas Homes by 10.7% in the first quarter. PDT Partners LLC now owns 13,988 shares of the company's stock worth $273,000 after purchasing an additional 1,349 shares in the last quarter. New York State Common Retirement Fund increased its holdings in Smith Douglas Homes by 1.0% in the first quarter. New York State Common Retirement Fund now owns 185,119 shares of the company's stock worth $3,614,000 after purchasing an additional 1,744 shares in the last quarter. Finally, First Eagle Investment Management LLC increased its holdings in Smith Douglas Homes by 1.7% in the second quarter. First Eagle Investment Management LLC now owns 240,382 shares of the company's stock worth $4,668,000 after purchasing an additional 4,000 shares in the last quarter.

Smith Douglas Homes Company Profile

Smith Douglas Homes Corp., together with its subsidiaries, engages in the design, construction, and sale of single-family homes in the southeastern United States. It also provides closing, escrow, and title insurance services. The company sells its products to entry-level and empty-nest homebuyers. Smith Douglas Homes Corp.