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Stocks to Buy: Three Housing Finance stocks that Bernstein expects to outperformThe three housing finance companies that Bernstein expects to outperform, are likely to deliver returns between 17% and 22% over the next 12 months.By Hormaz Fatakia   July 10, 2025, 8:49:29 AM IST (Published)2 Min ReadBrokerage firm Bernstein has initiated coverage on four housing finance companies - Home First Finance, Aptus Value Housing Finance, Aadhar Housing Finance and Aavas Financiers, on Thursday, July 10.

While the first three come with an "outperform" recommendation, the brokerage has initiated coverage on Aavas Financiers with a "market-perform" rating.

For Home First Finance, Bernstein's "outperform" recommendation comes with a price target of ₹1,650, implying a potential upside of 21% from current levels.

Aptus Value's price target of ₹400 implies a potential upside of 17% from Wednesday's closing levels.

Bernstein expects Aadhar Housing Finance shares to gain another 22.5% from Wednesday's closing levels, based on its price target of ₹550, while Aavas Financier's price target of ₹2,070 does not imply significant upside from current levels.

StockTarget (₹)Upside PotentialHome First Finance1,65021%Aptus Housing40017%Aadhar Housing55022%Aavas Financiers2,0704.7%

Ability to consistently replicate its operating model across multiple states is one key factor that drives Bernstein's bullish call on Home First Finance. The company also benefits from its smaller size, faster growth and superior productivity metrics are some of the other factors that work in favour of Home First Finance. There is also greater flexibility for the company to sustain profitability compared to peers, Bernstein said.

Aptus Housing has reasonable valuations and there is a higher shares of fixed-rate loans and small business lending positions the company well in a falling interest rate environment, Bernstein wrote in its note.

Aadhar Housing serves as a good proxy in this field, being the largest and most geographically diversified players, according to the brokerage, who expects the company to maintain its steady growth trajectory of growing its Assets Under Management at a Compounded Annual Growth Rate (CAGR) of 20%.

While Bernstein does expect a near-term rebound in Aavas Financiers, inconsistent outcomes from geographic expansion makes the brokerage cautious on its long-term outlook.

Shares of Aavas Financiers have risen 4.3% in the last one month, while those of Aptus, Home First have risen 3.5% and 7.3% respectively over the same timeframe. However, shares of Aadhar Housing have been underperformers, declining 0.8% in the last one month.Continue ReadingCheck out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!TagsAadhar Housing FinanceAavas FinanciersAptus Value Housing Financebuy sell ideasHome First Financeshare market todayStocks to buy