TOL is gearing up for its fiscal third-quarter earnings report
The housing market is under scrutiny today, after privately owned starts for July came in well above analysts' estimates at an adjusted annual rate of 1.428 million, while building permits fell 2.8% from June and missed expectations. Despite the mixed data, Lennar Corp (NYSE:LEN) and Toll Brothers Inc (NYSE:TOL) are enjoying afternoon gains.
LEN Breaks Above Technical Resistance
LEN was last seen 1.6% higher to trade at $133.52, following Friday's rally to its highest level since January. The stock sports a 22% three-month lead and started consolidating above the 200-day moving average last week, after trading below this trendline since early December.
Lennar stock could benefit from an unwinding of pessimism. The security's Schaeffer's put/call open interest ratio (SOIR) of 1.28 ranks in the 97h percentile of readings from the past year. Plus, 15 of the 19 equities in coverage call LEN a tepid "hold" or worse.
Can TOL Snap Its Post-Earnings Losing Streak?
TOL is up 0.6% to trade at $132.17 at last glance, with the homebuilder's fiscal third-quarter results due out after today's close. BofA Global Research also raised the equity's price target to $145 from $132 earlier. The shares sport a 16% quarter-to-date lead, with long-term support from the 20-day moving average containing multiple pullbacks since late June.
Toll Brothers stock has a mixed history of post-earnings moves, settling lower after its three most recent quarterly reports, and four of the past eight quarters. This includes an 8.5% tumble in May 2024. The shares averaged a next-day swing of 4.6%, regardless of direction, in the last two years. This time, the options pits are pricing in a bigger move of 6.6%.