D.R. Horton (DHI) is starting to look more attractive with its price-to-book multiples falling notably from earlier in the year, Truist Securities said in a Monday note.

"Investors should take note of this at DHI specifically given how consistently this has been an indicator of 1-yr forward returns over the last 15 years," the report said.

The note said its price-to-book ratio for the last 12 months is now around 1.6x following the selloff in builder stocks since late August. It added that the stock rarely reaches near 1.5x levels.

"We are incrementally more positive on DHI on what could end up being trough P/B with some macro stabilization," it said.

Still, Truist kept its hold rating on DHI with a price target of $140, citing recent bond market selloff and uncertainty heading into earnings season with the September mortgage rate move.

Price: 134.51, Change: -0.37, Percent Change: -0.27