These 3 Housing Stocks Are Laying the Foundation for a Comeback

Core Insights - The housing market is currently struggling but shows signs of recovery, with easing interest rates and home prices expected to lead to improvements by 2026 [2][7] - Companies like D.R. Horton, Lowe's, and Whirlpool are well-positioned to benefit from the anticipated recovery in the housing market, with long-term stock price growth expected [3][7] Company-Specific Insights - D.R. Horton, as the largest homebuilder in the U.S., is facing revenue pressure due to falling home prices in 2025, but ongoing volume growth is crucial for sustaining cash flow and capital returns [4] - The company has reduced its share buyback forecast but still expects robust buybacks at approximately 5.8% of its late-November market cap, following a nearly 10% decline in FY2025 [5] - D.R. Horton offers a reliable dividend yielding about 1.25%, with a payout ratio below 15% of earnings, and share buybacks are expected to support per-share metrics [6] Market Sentiment - Analyst sentiment is mixed, with some price target reductions balanced by increases, but overall bullish due to institutional buying, which is more than $2 for every $1 sold in the first half of Q4 [9] - Institutional ownership exceeds 90% of D.R. Horton stock, indicating strong support for the company as it navigates the housing market recovery [9]