The housing market got two pieces of bad news Friday. The first being weaker-than-expected earnings for KB Home (NYSE: KBH) and the second being a less-than-expected rise in new home sales last month.

First, the good news. New home sales did rise last month. In the current economic environment, that by itself is good news. Unfortunately the rise was less than analysts had been expecting to see.

Continue reading New home sales rose less than expected last month

New home sales rose less than expected last month originally appeared on BloggingStocks on Fri, 25 Sep 2009 13:30:00 EST. Please see our terms for use of feeds.

Shares of California-based homebuilder KB Home (NYSE: KBH) sold off Friday morning after the company failed to meet analyst estimates for its third quarter.

As we noted in our earnings preview, analysts were expecting to see the company show a loss of 56 cents per share for its third quarter, but the company failed to hit that number, posting an actual loss of a much worse 87 cents per share.

Continue reading KB Home narrows loss but misses estimates

KB Home narrows loss but misses estimates originally appeared on BloggingStocks on Fri, 25 Sep 2009 11:30:00 EST. Please see our terms for use of feeds.

Continue reading KB Home third quarter earnings preview

KB Home third quarter earnings preview originally appeared on BloggingStocks on Thu, 24 Sep 2009 16:20:00 EST. Please see our terms for use of feeds.

Continue reading Hovnanian shares slide on earnings, housing woes

Hovnanian shares slide on earnings, housing woes originally appeared on BloggingStocks on Thu, 03 Sep 2009 14:00:00 EST. Please see our terms for use of feeds.

Lennar (NYSE: LEN) has had one of the most impressive rebounds of all the home builders. The stock has been up as much as 340% since bottoming last November.

Wall Street's current consensus for Lennar's earnings this year is a loss of $2.88. In my opinion, that's too low. I think Lennar will have little trouble surprising Wall Street analysts later this year.

Lennar is a good momentum buy.

Continue reading Home builder stock #4: Lennar (LEN)

Home builder stock #4: Lennar (LEN) originally appeared on BloggingStocks on Sun, 30 Aug 2009 11:00:00 EST. Please see our terms for use of feeds.

KB Home (NYSE: KBH) was hit incredibly hard by the housing bust. The stock fell from $82 to just $7 per share. We haven't seen shakeouts like that since the tech bust.

Unlike some of the other home builders, KBH probably hit bottom early. The company's loss from last year wasn't as bad as its loss from 2007, and that's a good sign.

What I also like about KB Home is that the stock's volatility has calmed down, which is often the result of heavy institutional buying.

Continue reading Home builder stock #3: KB Home (KBH)

Home builder stock #3: KB Home (KBH) originally appeared on BloggingStocks on Sun, 30 Aug 2009 09:00:00 EST. Please see our terms for use of feeds.

D.R. Horton (NYSE: DHI) saw its earnings-per-share plunge from a profit of $3.90 in 2006 to a staggering loss of $8.34 last year. Fortunately, the worst is behind us. This year D.R. Horton will probably lose about $1 per share.

I don't like to see any loss, but this is a huge improvement. In fact, I think there's even a good chance D.R. Horton could start posting some earnings gains by next year.

D.R. Horton is also a buy.

Next: Home builder stock #3

Home builder stock #2: D.R. Horton (DHI) originally appeared on BloggingStocks on Sat, 29 Aug 2009 13:00:00 EST. Please see our terms for use of feeds.

NVR (NYSE: NVR) is probably the healthiest of all the major home builders. In fact, the company hasn't taken a single annual loss yet. The company reported a quarterly loss for the fourth quarter of 2008, but all of the other quarters have recorded a profit.

Even though NVR is a fairly small company (market value of nearly $4 billion), the stock carries a very high price. The shares are currently over $660 a piece, which is even higher than Google.

Continue reading Home builder stock #1: NVR (NVR)

Home builder stock #1: NVR (NVR) originally appeared on BloggingStocks on Sat, 29 Aug 2009 11:00:00 EST. Please see our terms for use of feeds.

The past few years haven't been what you might call a happy time for shares of home building stocks. Consider that the Homebuilders Exchange-Traded Fund (NYSE: XHB) plunged from $40 per share in early 2007 to just $8 per share earlier this year.

Since March, however, things have improved. There are signs that the housing market is getting back on its feet -- or at least, declining less slowly. Existing home sales recently registered their biggest gain in more than a decade. Seasonally-adjusted single-family building permits are up 27% since bottoming in March, while single-family housing starts have increased five straight months and are up 36% since March.

Continue reading Is it safe to buy home builders?

Is it safe to buy home builders? originally appeared on BloggingStocks on Sat, 29 Aug 2009 09:00:00 EST. Please see our terms for use of feeds.

Last week's Fed Beige Book report and GDP numbers suggested that the economy may be stabilizing, and this coming week will bring plenty of economic data to confirm or deny that suggestion. On the schedule are consumer credit, construction spending, factory orders, and pending home sales for June, the employment situation, the Import Price Index, and new motor vehicle sales for July, as well as the ISM Manufacturing and Non-manufacturing Indexes for July.

The week will also bring quarterly reports from home builders Beazer Homes USA Inc. (NYSE: BZH), D.R. Horton Inc. (NYSE: DHI), and Pulte Homes Inc. (NYSE: PHM). Yet again, analysts surveyed by Thomson Reuters expect all three to have narrowed their losses in the most recent quarter. However, they've all tended to post deeper-than-expected losses in recent quarters as well. Analysts also expect to see their revenue down 45% or more for the past quarter. They forecast long-term EPS growth of 7% or more, but none of these homebuilders has a First Call consensus buy recommendation, not surprisingly. Short interest is falling off for Beazer and D.R. Horton, and D.R. Horton and Pulte have been reporting positive cash flow from operations, but all three of them said they had more long-term debt than cash in hand last time around. Mortgage insurer PMI Group Inc. (NYSE: PMI) is likewise expected to report that it narrowed its second-quarter loss.

Continue reading The week in preview: Seeking more signs of economic stability

The week in preview: Seeking more signs of economic stability originally appeared on BloggingStocks on Sun, 02 Aug 2009 12:30:00 EST. Please see our terms for use of feeds.

Continue reading Homebuilder sentiment rises to highest level in 10 months

Homebuilder sentiment rises to highest level in 10 months originally appeared on BloggingStocks on Thu, 16 Jul 2009 18:00:00 EST. Please see our terms for use of feeds.

This is good news! The Commerce Department reported that housing starts soared 17% in May. Housing starts increased to 532,000 from 454,000 the prior month. Projections were for an increase to only 485,000.

Here are the supporting numbers:

• Permits rose to 518,000, up from 498,000. Forecasts were for 508,000.
• Single family homes rose 7.5% to 401,000, the third straight monthly gain.

Continue reading Housing starts jump 17% in May

Housing starts jump 17% in May originally appeared on BloggingStocks on Tue, 16 Jun 2009 12:20:00 EST. Please see our terms for use of feeds.

Hovnanian Enterprises (NYSE: HOV), a home builder whose related companies include Toll Brothers (NYSE: TOL), Lennar Corp. (NYSE: LEN), and D.R. Horton (NYSE: DHI), reported Q2 results on Tuesday after the bell. The company reported a loss of $1.50 per share (the results included a gain related to debt extinguishment). That unfortunately did not meet analyst expectations according to Trey Thoelcke's earnings preview. Analysts were looking for a loss of $1.26 per share.

However, things do look better. Last year at this time, the loss recorded by Hovnanian was a whopping $5.29 per share. Revenues, however, plummeted to $398 million from over $770 million. Analysts were expecting only $348 million according to the preview.

Continue reading Hovnanian's Q1 shows an improvement

Hovnanian's Q1 shows an improvement originally appeared on BloggingStocks on Wed, 03 Jun 2009 08:20:00 EST. Please see our terms for use of feeds.

Continue reading KB Home posts better than expected quarterly earnings

KB Home posts better than expected quarterly earnings originally appeared on BloggingStocks on Fri, 27 Mar 2009 11:20:00 EST. Please see our terms for use of feeds.

One of the programs which may come with the new economic stimulus package is a big tax credit for people who buy new homes. It would help potential buyers across almost every income class, which is not what was being contemplated a few days ago. According to Bloomberg, "By replacing a $7,500 tax credit for first-time homebuyers earning less than $150,000 with a $15,000 break for all income groups as part of the economic stimulus package, senators effectively are encouraging purchases by higher-income households with a reduced risk of default."

Last week, Moody's said it was reviewing debt ratings on four home builders, including Beazer (NYSE: BZH) and Hovnanian (NYSE: HOV), for downgrades. That did not do the shareholder in the companies any favors.

Continue reading U.S. stimulus plan may give home builders a lift

U.S. stimulus plan may give home builders a lift originally appeared on BloggingStocks on Sat, 07 Feb 2009 14:40:00 EST. Please see our terms for use of feeds.

Shameless homebuilders push for a bailout originally appeared on BloggingStocks on Mon, 24 Nov 2008 09:57:00 EST. Please see our terms for use of feeds.

Continue reading U.S. housing starts fall to 17-year low

U.S. housing starts fall to 17-year low originally appeared on BloggingStocks on Wed, 17 Sep 2008 14:15:00 EST. Please see our terms for use of feeds.

Continue reading The housing slump may continue well into 2010

The housing slump may continue well into 2010 originally appeared on BloggingStocks on Tue, 19 Aug 2008 10:57:00 EST. Please see our terms for use of feeds.

Anyone looking for good news in the housing sector will no doubt be keeping an eye on homebuilders Lennar Corp. (NYSE: LEN) and KB Home (NYSE: KBH) when they report second-quarter earnings this week. Both companies are expected by analysts surveyed by Thomson Financial to narrow their losses.

Lennar is expected to report net loss of 45 cents per share, as compared to a loss of 56 cents per share in the previous quarter and a loss of $1.55 per share in the year ago period. While the company hasn't posted a quarterly profit since the first quarter of 2007, the loss per share in the most recent quarter was 51 cents smaller than analysts had expected.

Miami-based Lennar is one of the largest homebuilders in the U.S., and it also provides financial services for home buyers. Even with the housing slump, the company had revenues in the past year of $10.2 billion, but its net loss totaled $1.9 billion. The company's long-term EPS growth forecast is 11.5%, which is less than the sector average and the S&P 500. The consensus recommendation of analysts remains to hold Lennar.

Shares closed Tuesday at $14.72, up from the 52-week low of $11.98 in January. The share price is down 62.9% from a year ago.

Continue reading Lennar, KB Home expected to narrow Q2 losses

Lennar, KB Home expected to narrow Q2 losses originally appeared on BloggingStocks on Wed, 25 Jun 2008 09:52:00 EST. Please see our terms for use of feeds.

Continue reading Baum: Stagnant housing sector needs drastic action ... such as lowered prices

Baum: Stagnant housing sector needs drastic action ... such as lowered prices originally appeared on BloggingStocks on Wed, 18 Jun 2008 17:45:00 EST. Please see our terms for use of feeds.