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David C. Merritt, a director at Taylor Morrison Home Corp (NYSE:TMHC), a $6.3 billion homebuilder trading at an attractive P/E ratio of 7.4, recently sold shares of the company’s common stock, according to a regulatory filing. According to InvestingPro analysis, the company appears undervalued based on its Fair Value estimates. On February 25, Merritt disposed of a total of 2,402 shares, with prices ranging from $63.98 to $64.01 per share. The total value of the transaction amounted to $153,685. Following the sale, Merritt no longer holds any shares of the company’s stock directly. While this director has exited his position, InvestingPro data shows management has been actively buying back shares, and the company maintains strong financial health with robust liquidity ratios. Get access to 10+ additional ProTips and comprehensive analysis in the Pro Research Report.
In other recent news, Taylor Morrison Home Corp reported strong financial results for the fourth quarter of 2024, exceeding expectations with an adjusted earnings per share (EPS) of $2.64, surpassing the forecast of $2.40. The company also reported revenue of $2.36 billion, which was higher than the anticipated $2.11 billion. Following these results, analysts from Raymond (NSE:RYMD) James and BTIG adjusted their price targets for Taylor Morrison, with Raymond James lowering the target to $74 while maintaining an Outperform rating, and BTIG reducing it to $83 while keeping a Buy rating. Both analysts cited the company’s strong financial outlook and strategic positioning as reasons for their positive ratings despite the target adjustments.
Taylor Morrison also announced an accelerated share repurchase agreement worth $50 million as part of its ongoing $1 billion share repurchase program. This move is seen as a strategy to return value to shareholders and reflects the company’s confidence in its financial stability. Additionally, Taylor Morrison’s robust cash flow and substantial land inventory are expected to support ongoing share repurchases, with guidance suggesting potential buybacks of about 4% of the company at current market prices.
The company’s diverse product offerings and focus on resort/lifestyle and move-up buyers have contributed to its resilience in the market, despite challenges such as fluctuating mortgage rates. Taylor Morrison’s strategic positioning and financial health, including a low-leverage balance sheet and a 15% return on equity, are viewed favorably by analysts, providing a buffer against potential market pressures. The company’s guidance for 2025 includes expectations for home closings between 13,500 and 14,000, with a gross margin of 23% to 24%, and significant share repurchases valued between $300 million and $350 million.
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