"As homebuilding's utopia looks increasingly out of reach, we no longer expect builders to defy gravity," analyst Matthew Bouley wrote in a Wednesday note. Each of those stocks has been under pressure this quarter as investors adjust their expectations for lower Federal Reserve interest rates. On top of that, the incoming Trump administration could impose tariffs on a bevy of imported materials used by homebuilders, which could also make it harder for the central bank to lower rates. Unless interest rates take a sustainable path lower, Bouley said the rise in new and existing home inventory will put downward pressure on home prices. Bouley kept his $170 price target on D.R.

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Persons: Lennar, Matthew Bouley, Horton, DHI LEN, PHM, Trump, Bouley, David Auld Organizations: Barclays, of Labor Statistics, KB Locations: Horton, U.S