Jan-Mar Results Recap for 3 Housing Companies: Japan Solid; US Detached Housing Weak

Research evidence excerpt

Jan-Mar Results Recap for 3 Housing Companies: Japan Solid; US Detached Housing Weak

Idea

June 19, 2026 06:30 AM GMT

Morgan Stanley MUFG Securities Co., Ltd.+MHousing | Japan Toshiyuki Anegawa

Equity Analyst

Jan-Mar Results Recap for 3 Toshiyuki.Anegawa@morganstanleymufg.com +81 3 6836-8914

Housing Companies: Japan Solid;

US Detached Housing Weak Housing

Japan

Catalysts are lacking amid no signs of recovery in US detached Industry View In-Line

housing. We see some risk of cost increases in domestic What’s Changed

Sumitomo Forestry (1911.T) From To

contract/condo business due to the Middle East situation, but Price Target ¥1,500 ¥1,400

resilience overall, with limited supply chain disruption evident. Daiwa House Industry

(1925.T) From To

Price Target ¥5,400 ¥4,700

Key Takeaways

Sekisui House (1928.T) From To

US detached house sales disappointed in the spring, and prospects of margin Price Target ¥3,600 ¥3,450

recovery from Jun Q remain uncertain.

In Japan, the Middle East situation poses risk of upside to costs, but business

appears broadly firm.

We stay EW on all three home builders.

We forecast downside to current FY OP guidance for Sumitomo Forestry and

Sekisui House, and upside for Daiwa House, whose plan looks conservative.

Fundamentals and focus points: In US detached housing, prolonged high inflation

and interest rates led margins to decline further in Mar Q, with little sign of

recovery and orders remaining soft. Sumitomo Forestry: We expect a guidance

revision at 2Q results in Aug to factor in the Tri Pointe Homes acquisition completed

on May 14, but see a risk of a downward revision given current conditions. However,

this could reinforce the sense bad news has played out. We expect Tri Pointe Homes

to contribute fully in F12/28.