J.P. Morgan & Chase Co. downgraded shares of Irvine-based Standard Pacific Corp. on Wednesday, in a sign of Wall Street’s skittishness on homebuilders.
Analysts and investors are looking closely at homebuilders and other real estate-related companies as the Federal Reserve Bank continues to raise short-term interest rates.
The Fed on Tuesday raised a key short-term rate to 3.75%, despite speculation it might halt rate hikes in response to Hurricane Katrina.
J.P. Morgan lowered its rating on Standard Pacific to “underweight” from “neutral.” The homebuilder’s shares were off slightly to $39.89 on Wednesday.
Meanwhile, Miami-based Lennar Corp., which has a regional headquarters in Aliso Viejo, said Wednesday that its profit for the most recent quarter would beat analysts’ estimates. The builder is set to release its earnings next week.
“While we generally don’t preannounce our quarterly results, given yesterday’s market volatility and given the fact that our Miami corporate office was closed and management was inaccessible because of Hurricane Rita, we felt it prudent to preannounce our third-quarter results,” said Stuart Miller, Lennar’s chief executive, in a statement.
