Smith Douglas Homes (NYSE:SDHC) Shares Up 11.3% - What's Next?

Key Points

• Smith Douglas Homes (NYSE:SDHC) shares rose by 11.3% to $20.86, with significant trading volume despite a 28% decline from its average session volume.
• Analysts generally maintain a "Hold" rating on the stock, with price targets ranging from $16.00 to $24.00, reflecting cautious sentiment regarding its future performance.
• The company announced a $50 million share buyback plan, indicating management's belief that the stock may be undervalued.

Smith Douglas Homes Corp. (NYSE:SDHC - Get Free Report)'s share price was up 11.3% during trading on Wednesday . The stock traded as high as $21.15 and last traded at $20.86. Approximately 55,239 shares traded hands during trading, a decline of 28% from the average daily volume of 76,655 shares. The stock had previously closed at $18.74.

Wall Street Analyst Weigh In

Several equities analysts have issued reports on the stock. Royal Bank Of Canada set a $16.00 target price on shares of Smith Douglas Homes and gave the company a "sector perform" rating in a research note on Tuesday, May 20th. JPMorgan Chase & Co. lowered their price objective on shares of Smith Douglas Homes from $24.00 to $18.50 and set a "neutral" rating on the stock in a research report on Wednesday, May 21st. Wall Street Zen downgraded shares of Smith Douglas Homes from a "hold" rating to a "sell" rating in a research report on Saturday, August 9th. Finally, Wedbush reiterated a "neutral" rating and set a $18.00 target price on shares of Smith Douglas Homes in a research note on Wednesday, May 14th. Two research analysts have rated the stock with a sell rating and four have given a hold rating to the stock. According to data from MarketBeat, the stock presently has an average rating of "Hold" and a consensus price target of $18.90.

Smith Douglas Homes Stock Up 2.2%

The stock's fifty day simple moving average is $19.60 and its 200 day simple moving average is $19.97. The firm has a market capitalization of $1.06 billion, a PE ratio of 12.93, a PEG ratio of 13.21 and a beta of 1.05.

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

Smith Douglas Homes declared that its board has approved a stock repurchase program on Wednesday, May 28th that authorizes the company to repurchase $50.00 million in outstanding shares. This repurchase authorization authorizes the company to buy up to 5.1% of its shares through open market purchases. Shares repurchase programs are typically a sign that the company's board believes its shares are undervalued.

Insider Transactions at Smith Douglas Homes

In other news, insider Russell Devendorf acquired 3,000 shares of Smith Douglas Homes stock in a transaction on Wednesday, May 21st. The shares were acquired at an average price of $16.80 per share, with a total value of $50,400.00. Following the purchase, the insider directly owned 299,952 shares in the company, valued at $5,039,193.60. The trade was a 1.01% increase in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this hyperlink. Also, Director George Ervin Perdue III acquired 10,000 shares of the firm's stock in a transaction dated Tuesday, June 3rd. The shares were purchased at an average cost of $19.09 per share, for a total transaction of $190,900.00. Following the completion of the acquisition, the director directly owned 24,345 shares in the company, valued at approximately $464,746.05. This represents a 69.71% increase in their ownership of the stock. The disclosure for this purchase can be found here. Over the last quarter, insiders have purchased 34,652 shares of company stock valued at $638,024. 82.71% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Smith Douglas Homes

Several institutional investors have recently bought and sold shares of the business. M&T Bank Corp boosted its holdings in Smith Douglas Homes by 8.4% during the 1st quarter. M&T Bank Corp now owns 11,001 shares of the company's stock valued at $215,000 after acquiring an additional 848 shares during the period. Two Sigma Investments LP increased its holdings in shares of Smith Douglas Homes by 366.3% in the 4th quarter. Two Sigma Investments LP now owns 27,550 shares of the company's stock valued at $706,000 after acquiring an additional 21,642 shares during the period. New York State Common Retirement Fund raised 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. Massachusetts Financial Services Co. MA lifted its position in Smith Douglas Homes by 11.6% during the first quarter. Massachusetts Financial Services Co. MA now owns 486,509 shares of the company's stock valued at $9,497,000 after acquiring an additional 50,713 shares during the last quarter. Finally, Renaissance Technologies LLC lifted its holdings in shares of Smith Douglas Homes by 31.9% during the 4th quarter. Renaissance Technologies LLC now owns 99,200 shares of the company's stock valued at $2,543,000 after purchasing an additional 24,000 shares during the last quarter.

About Smith Douglas Homes

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.