Analysts believe the CSR Ltd (ASX: CSR) share price could benefit from a boost of residential housing work following the east coasts floods.
Shares in the building products company are currently swapping hands at $5.98 apiece, a 0.5% gain. For perspective, the S&P/ASX 200 Index (ASX: XJO) is up around the same so far today.
Let's take a look at what could impact the CSR share price.
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More housing construction
Citi analysts believe the recent floods in NSW and Queensland will add $2 billion worth of residential work for the home building industry including CSR, The Australian reported.
Fletcher Building Limited (ASX: FBU) is another company the broker believes could benefit from this work.
The broker has a $6.63 price target on CSR shares, 10.5% higher than its current price.
In a broker note, the analysts said:
Post recent insurer disclosures, we update our potential flood impact view. We estimate an additional about $2bn worth of residential housing work has been added or about 10 per cent to the already-elevated backlog.
Despite lead indicators such as house price and approvals slowing, we estimate the current backlog will take longer to clear than the market is expecting.
As my Foolish colleague Tristan reported recently, CSR will pay a 7% dividend yield in FY22. The company declared a fully-franked dividend of 13.5 cents per share in its FY22 half-year results.
JP Morgan analysts also recently placed an overweight rating on CSR with a $6.15 price target.
CSR share price snapshot
The CSR share price has gained 8% in the past year and about 2% year to date.
In the past month, the company's shares have gained more than 4%.
For perspective, the benchmark ASX index has returned around 9.6% over the past year.
CSR has a market capitalisation of around $2.9 billion based on today's share price.
