High Quality Stock Setups, Weekly Stock Bull Finder

Weekly Stock Bull Finder

High Quality Stock Setups

Finding high potential stock setups on quality companies

Thematic (Sector/Industry)

<ul>
<li>The ITB US Home Construction ETF is now up 33% YTD and represents one of the biggest market surprises for me so far in 2023.</li>
<li>This group has flashed relative strength vs. the S&amp;P 500 since December 2022 and continues to one of the top performing groups.</li>
<li>After undergoing correction in 2022, the homebuilders sector has tons of weekly charts breaking out of long and healthy weekly bases in strong uptrends</li>
</ul>


The ITB US Home Construction ETF is now up 33% YTD and represents one of the biggest market surprises for me so far in 2023.
This group has flashed relative strength vs. the S&amp;P 500 since December 2022 and continues to one of the top performing groups.
After undergoing correction in 2022, the homebuilders sector has tons of weekly charts breaking out of long and healthy weekly bases in strong uptrends


New Zealand Professional Investment Services Firm, Forsyth Barr

Forsyth Barr

New Zealand Professional Investment Services Firm

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

Equity Bottom-Up

<h2>Building weekly</h2>
New Zealand
<ul>
<li>Housing inventory vanishing on healthy demand and lack of listings (<a href="http://realestate.co.nz/" target="_blank" data-saferedirecturl="https://www.google.com/url?q=http://realestate.co.nz&amp;source=gmail&amp;ust=1578706518396000&amp;usg=AFQjCNF9fDnwdMe_yL3Fsxcuh6LZGaWWug" rel="noopener">realestate.co.nz</a>, Dec.): Auckland property inventory -26% yoy on total new listings down -9%. Ex-Auckland inventory -24% yoy on new listings -11%.</li>
<li>Big jump in Auckland house sales (Barfoot &amp; Thompson; Dec.): Auckland sales up +55% yoy with available listings +23%.</li>
</ul>
Australia
<ul>
<li>Bounce in residential approvals, mainly from multi (Nov): +11.8% mom, -3.8% yoy (previous -7.9% mom, -22.9% yoy) including multi-tenanted +6% yoy and detached dwellings -10%. Weak month for non-residential: -20.7% mom, -20.0% yoy. Trend series -5.0% mom, +5.0% yoy. Past 12 months +10% yoy.</li>
<li>Construction activity still declining sharply (Performance of Construction Index, Dec.): 38.9 (previous 40.0; contraction &lt;50&lt; expansion) with apartments 37.4 (previous 37.0), houses 50.8 (previous 49.7), commercial 41.3 (previous 43.7) and engineering 29.5 (previous 33.3).</li>
<li>Continued recovery in Sydney and Melbourne house prices (CoreLogic-RPData, capital cities, Dec.): +1.3% mom, +3.1% yoy (previous +2.0% mom, +0.4% yoy). Sydney and Melbourne were up +1.7% mom and +1.4% mom respectively.</li>
</ul>
International
<ul>
<li>US: New home sales remain strongly up yoy (Nov.): +1.3% mom, +16.9% yoy (previous -2.7% mom, +27.5% yoy).</li>
<li>US: Demand jumps for US homebuilders:</li>
</ul>
&nbsp; &nbsp; &nbsp; &nbsp;-Largest US homebuilder Lennar’s 4Q new orders “exceeded expectations” (4Q): New orders (number of units) up +23% in 4Q, taking full year to +12%. “The basic underlying housing market fundamentals of low unemployment, higher wages and low inventory levels remained favourable.”
&nbsp; &nbsp; &nbsp; &nbsp;-KB Home has “excellent finish to FY19” (4Q): 4Q new orders (number of units) up +38%. “Factors driving demand remain favourable, with job and wage growth, high consumer confidence, increasing household formation and demand from millennials. … Supply of resale homes remains low and there has been an underproduction of new homes over a multi-year period.”
<ul>
<li>US: Modest construction growth (Nov.): residential +1.8% mom, +2.9% yoy (previous +0.7% mom, +4.2% yoy), non-residential -0.3% mom, +5.1% yoy (previous -0.3% mom, +2.3% yoy).</li>
<li>UK: Flat real house prices (Dec.): +0.1% mom, +1.5% yoy (previous +0.5% mom, +0.7% yoy).</li>
</ul>
Chart of the week: You need to look hard to see “the bounce” in Australia detached dwelling approvals. Residential construction activity is going to decline further from here.
Australia detached dwelling approvals
<figure class="editor-figure mceNonEditable"><img src="https://mail.google.com/mail/u/0?ui=2&amp;ik=f57c39853c&amp;attid=0.1&amp;permmsgid=msg-f:1655302632865447342&amp;th=16f8d0f973b6bdae&amp;view=fimg&amp;sz=s0-l75-ft&amp;attbid=ANGjdJ-3UXb7ztIL13NiX5_3x5cDpvO04HJEyToMlGd0o8vokXNPJusKcI2WMZWiOxAG4lYA-Vb2tqKG68yFJezPitGAC4ZZFDDPaPQoXFLcdAOnecr0sZRmTrsIut0&amp;disp=emb" width="453" height="340" class="editor-image img-responsive" data-image-whitelisted=""></figure>
Source: ABS, Forsyth Barr analysis
Matt Henry &nbsp;CFA Head of Wealth Management Research Forsyth Barr Limited
P: +64 9 368 0115 | TF: 0800 367 227&nbsp; Level 23, Lumley Centre, 88 Shortland Street, Auckland

Building weekly
New Zealand

Housing inventory vanishing on healthy demand and lack of listings (realestate.co.nz, Dec.): Auckland property inventory -26% yoy on total new listings down -9%. Ex-Auckland inventory -24% yoy on new listings -11%.
Big jump in Auckland house sales (Barfoot &amp; Thompson; Dec.): Auckland sales up +55% yoy with available listings +23%.

Australia

Bounce in residential approvals, mainly from multi (Nov): +11.8% mom, -3.8% yoy (previous -7.9% mom, -22.9% yoy) including multi-tenanted +6% yoy and detached dwellings -10%. Weak month for non-residential: -20.7% mom, -20.0% yoy. Trend series -5.0% mom, +5.0% yoy. Past 12 months +10% yoy.
Construction activity still declining sharply (Performance of Construction Index, Dec.): 38.9 (previous 40.0; contraction &lt;50&lt; expansion) with apartments 37.4 (previous 37.0), houses 50.8 (previous 49.7), commercial 41.3 (previous 43.7) and engineering 29.5 (previous 33.3).
Continued recovery in Sydney and Melbourne house prices (CoreLogic-RPData, capital cities, Dec.): +1.3% mom, +3.1% yoy (previous +2.0% mom, +0.4% yoy). Sydney and Melbourne were up +1.7% mom and +1.4% mom respectively.

International

US: New home sales remain strongly up yoy (Nov.): +1.3% mom, +16.9% yoy (previous -2.7% mom, +27.5% yoy).
US: Demand jumps for US homebuilders:

&nbsp; &nbsp; &nbsp; &nbsp;-Largest US homebuilder Lennar’s 4Q new orders “exceeded expectations” (4Q): New orders (number of units) up +23% in 4Q, taking full year to +12%. “The basic underlying housing market fundamentals of low unemployment, higher wages and low inventory levels remained favourable.”
&nbsp; &nbsp; &nbsp; &nbsp;-KB Home has “excellent finish to FY19” (4Q): 4Q new orders (number of units) up +38%. “Factors driving demand remain favourable, with job and wage growth, high consumer confidence, increasing household formation and demand from millennials. … Supply of resale homes remains low and there has been an underproduction of new homes over a multi-year period.”

US: Modest construction growth (Nov.): residential +1.8% mom, +2.9% yoy (previous +0.7% mom, +4.2% yoy), non-residential -0.3% mom, +5.1% yoy (previous -0.3% mom, +2.3% yoy).
UK: Flat real house prices (Dec.): +0.1% mom, +1.5% yoy (previous +0.5% mom, +0.7% yoy).

Chart of the week: You need to look hard to see “the bounce” in Australia detached dwelling approvals. Residential construction activity is going to decline further from here.
Australia detached dwelling approvals

Source: ABS, Forsyth Barr analysis
Matt Henry &nbsp;CFA Head of Wealth Management Research Forsyth Barr Limited
P: +64 9 368 0115 | TF: 0800 367 227&nbsp; Level 23, Lumley Centre, 88 Shortland Street, Auckland

United States

KB Home builds single-family homes in the United States, primarily targeting first-time and first move-up homebuyers.  The Company has operating divisions in Arizona, California, Colorado, Florida, Georgia, Illinois, Nevada, Wisconsin, New Mexico,  North Carolina, South Carolina, and Texas in the United States. KB Home also derives income from mortgage banking, title and insurance services.

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Kb Home (KBH US)

Weekly Stock Bullfinder - Week of 6/19

The ITB US Home Construction ETF is now up 33% YTD and represents one of the biggest market surprises for me so far in 2023.

Weekly Stock Bull Finder

Building Weekly

Building weekly New Zealand Housing inventory vanishing on healthy demand and lack of listings (realestate.co.nz, Dec.): Auckland property...

Forsyth Barr

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