< The 2015 All-America Research Team
Michael Rehaut
J.P. Morgan
First-place appearances: 2
Total appearances: 9
Analyst debut: 2007
Michael Rehaut of J.P. Morgan advances from runner-up to third place. He wins investor loyalty with “good trading calls, both fundamental and tactical,” one fund manager attests. Rehaut, 42, revised his outlook on home-improvement products provider Masco Corp. last October, upgrading his rating on the Taylor, Michigan–based manufacturer of cabinets, coatings and faucets from neutral to overweight. He was encouraged by then–new CEO Keith Allman’s plans to cut costs, repurchase shares and spin off the company’s installation services business. Since then Masco’s stock has gained 31.6 percent, rising to $27.26 in mid-September and outperforming the S&P 500 by 32.3 percentage points. The analyst projects a further increase to $31 by December 2016. Until last month he had been similarly upbeat on Taylor Morrison Home Corp. since initiating coverage on the Scottsdale, Arizona–headquartered residential developer in May 2013. Underpinning his overweight stance were the builder’s attractive fundamentals — including its robust and sustainable gross margins, solid earnings expansion and strong order growth — as well as its appealing land inventory position. However, with the shares at $19.28 last month and little changed over the trailing 12 months, though ahead of broad market by 2.6 percentage points, he lowered his rating to hold, deeming the valuation reasonable in light of expected 2016 results. Rehaut’s year-end price objective for Taylor Morrison is $23.