beazer posts
FeedPosted May 16th 2009 10:30AM by Ted Allrich (RSS feed)
Filed under: General Motors (GM), Citigroup Inc. (C), Comfort Zone Investing
The stock market, as measured by the Dow Jones Industrial Average, sharply rebounded from its low of 6440 in March of this year. Currently, as this is written, the notable index is hovering around 8400. That's an increase of 30%. Not bad for two months of trading. While the average is made up of only 30 stocks, those 30 stocks are some of the best. There are also some real losers, such as General Motors (NYSE: GM) and Citigroup (NYSE: C). But for the most part, the index contains the strongest industries with some of the strongest stocks. With that kind of recovery already in place, is it too late to buy stocks or is this just the start of a major rally?
Continue reading Comfort Zone Investing: Is it too late ... or too early to buy stocks?
Posted Feb 7th 2009 2:40PM by Douglas McIntyre (RSS feed)
Filed under: Housing, Recession
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
Posted Dec 6th 2008 11:10AM by Trey Thoelcke (RSS feed)
Filed under: Earnings Reports, General Electric (GE), Johnson and Johnson (JNJ), Sears Holdings (SHLD), Research in Motion (RIMM), Goldman Sachs Group (GS), Yum Brands (YUM), Staples Inc (SPLS), Red Hat Inc (RHT), Merck and Co (MRK), Palm Inc (PALM), Marvell Technology Group (MRVL)
Here are some highlights from this past week's earnings coverage from BloggingStocks:
Continue reading Earnings highlights: Sears, GE, Goldman Sachs, Johnson & Johnson, Staples and others
Posted Nov 30th 2008 12:30PM by Trey Thoelcke (RSS feed)
Filed under: Earnings Reports, Forecasts, Sears Holdings (SHLD), Toll Brothers (TOL), Smithfield Foods (SFD)
Last week, Bank of Montreal (NYSE: BMO), one of Canada's oldest and largest banks, reported growth in its fiscal fourth-quarter earnings. But it may be the only one that does, as at least two of the Canadian banks scheduled to report fourth-quarter numbers this week have already released preliminary results that warn of lower earnings due to debt write-downs and trading losses.
Analysts surveyed by Thomson Reuters expect Toronto-based Canadian Imperial Bank of Commerce (NYSE: CM) to post earnings 42.6% lower than a year ago, or $1.28 per share. CIBC beat estimates by a penny in the third quarter, but missed by a penny in the period before that. The bank faces a class-action lawsuit related to investments in collateralized debt obligations consisting of U.S. subprime mortgages. Shares have climbed 20.7% from a recent 52-week low of $39.52, but are down 37.8% in the past three months.
Toronto Dominion Bank (NYSE: TD), Bank of Nova Scotia (NYSE: BNS), and Royal Bank of Canada (NYSE: RY) are expected to report more modest earnings declines of $1.01 per share, $0.73 per share, and $0.83 per share, respectively. All three Toronto-based banks topped estimates in the third quarter. Toronto Dominion and RBC have recently announced plans to offer shares in order to raise capital. Toronto Dominion and Scotiabank have been trading near 52-week lows, and their share prices are down around 39% in the past three months. But only Toronto Dominion has a consensus buy recommendation from analysts.
Continue reading The week in preview: Canadian banks, homebuilders, Sears and food producers
Posted Nov 7th 2007 6:48PM by Zac Bissonnette (RSS feed)
Filed under: Management
CTW Investment Group, a leading shareholder advisory group
has a tip for the board at
Beazer Homes USA, Inc. (NASDAQ:
BZH): Your company is facing legal problems and accounting woes along with a decline in fundamentals that have combined to erase the vast majority of the stock's value in the past year. Maybe, just maybe, it's time to think about hiring a new CEO.
The company won't be able to report its quarter on time, but did tell investors that it will be taking a $230 million pretax charge. The U.S. Attorney's Office and the SEC are also investigating the company. In June, the company fired its Chief Accounting Officer after it caught him trying to destroy documents -- never a good sign.
I've written about Beazer's woes
here and
here.
All of these scandals point to serious corporate governance and internal controls problems -- if the business was going swimmingly, you could argue that the CEO should stay on while the board and management look for a remedy.
But it doesn't look like Ian McCarthy has done anything right, and it's probably time for him to go. If anything, the fact that he isn't gone yet raises questions about the board of directors.
Posted Oct 12th 2007 11:22AM by Zac Bissonnette (RSS feed)
Filed under: Law, Market Matters, Housing
Beazer Homes (NYSE:
BZH) just can't seem to catch a break. The stock actually went up when the company announced that it would have to
restate earnings going back three years. With the uncertainty over its accounting seemingly out of the way, the Street breathed a sigh of relief.
But Beazer also found that employees had been violating the Department of Housing and Urban Development's regulations related to down payment assistance. Oh, and the company also recently
fired its chief accounting officer for shredding documents.
Of course, concerns over internal controls and accounting are not the only thing hurting Beazer; there's also that little problem of the housing downturn. Beazer is
reporting that during the last quarter, 68% of prospective home buyers canceled their orders, compared with 36% for the previous quarter.
Oh, and the company is facing lawsuits from home buyers accusing Beazer of unfair and deceptive sales practices.
Given the concerns about governance and management, combined with the concerns about the industry and business, shares of Beazer are probably too risky for most investors.
Posted Aug 31st 2007 9:29AM by Douglas McIntyre (RSS feed)
Filed under: Industry, Law, , Lennar Corp'A' (LEN), Housing
President George Bush seems an unlikely hero for Wall Street, but he is just that this morning.
The president intends to announce his plan to ease the plight of the subprime mortgage industry. Having so many voters without homes is not working out.
But, the law of unintended consequences is kicking in. Home builders are up big while the market waits for the Bush plan announced in about two hours. Beazer Homes (NYSE: BZH) is rallying off a level near its 52-week low and is up 8% to $10.65. Lennar (NYSE: LEN), Hovnanian (NYSE: HOV) and other large home builders are up sharply was well.
Over on the real estate lending side of town, Fremont General (NYSE: FMT) is up 15% and Countrywide Financial (NYSE: CFC) is in the green by 7%.
According to several press reports picked up by MarketWatch: "The Federal Housing Administration mortgage insurance program will be changed to allow more people to refinance with FHA insurance if they fall behind on adjustable-rate mortgages."
However, no one outside the Bush administration is likely to know much about the details of the plan yet and some of the proposals may require approval from Congress.
This means that just after Mr. Bush's speech, the home building and mortgage lending stocks could go right back down.
Douglas A. McIntyre is a partner at 24/7 Wall St.
Posted Aug 16th 2007 11:10AM by Zac Bissonnette (RSS feed)
Filed under: Scandals, Housing
Shares of Beazer Homes (NYSE: BZH) have lost almost 80% of their value so far this year. Investors have worried about the subprime meltdown and housing softness, and now you can toss those dreaded "accounting irregularities" into the stew. Last week the company told investors that its former chief account officer had improperly recorded "reserves and other accrued liabilities." The company fired him in June after he was caught trying to destroy company documents. Sweet.
The SEC had already begun investigating Beazer in May. According to The Wall Street Journal's Heard On The Street, "One possible focus of the SEC's inquiry is whether Beazer was properly disclosing its mortgage practices to investors [...] Accounting irregularities in the company's books, however, can be easier for investigators to pursue, this person said."
With the company's debt already in junk territory, I think you'd have to be nuts to even consider buying Beazer right now. The fundamentals of the business are terrible and there are serious questions about the ethics and legality of the company's practices. The company has repeatedly denied rumors that it is on the brink of bankruptcy, but if it is, the stock will likely go to zero. With its current market cap of over $400 million, that's a pretty steep fall. Oh yeah: we're still waiting for the 10-Q.
Shares of Beazer, along with shares of just about everything else, have opened substantially down this morning.
Posted Jul 23rd 2007 7:00AM by Kevin Kelly (RSS feed)
Filed under: Columns, Options, Economic Data, Housing
This week is a very big week for housing stocks. Wednesday, Wall Street will hear the home sales report from the National Association of Realtors.
According to the AP, the street is looking for 5.85 million homes resold in June versus 5.99 million resales in May. On Thursday, the Commerce Department will report new home sales. Again, the consensus is looking for a decline from May's figures.
I think that the subprime blow-up alongside falling real estate prices has forced the market to become very cautious in these names, and rightfully so. The uncertainty in earnings and book value writedowns to come has resulted in a situation where the risk may already be priced in. As a result, I tend to believe that any bad news from either numbers report is already priced in, and the stocks won't get killed if the numbers are ugly. But the entire sector will probably move very strongly if either of the numbers come in above consensus.
Traders might be interested in playing this number by picking up calls in their favorite home building stocks or a home building ETF. Keep in mind, superstar hedge fund Moore Capital owns
Beazer Homes (NYSE:
BZH) while Monish Pabrai and Greenlight Capital own
MDC Holdings (NYSE:
MDC). If you don't like any particular home builder, but believe in the priced-in thesis, you could pick up the
Streettracks Home building ETF (AMEX:
XHB). Best case (a good number from either report), the options will probably move rather significantly, worst case (two bad reports) I don't think they will get hit too hard.
Posted Jul 11th 2007 8:22AM by Douglas McIntyre (RSS feed)
Filed under: Industry, Consumer Experience, Competitive Strategy, KB HOME (KBH)
Home builders are in trouble. Wall Street just has to look at stock prices for Hovnanian (NYSE: HOV) and Beazer (NYSE: BZH) to see that they and their peers have lost half of their value in a year.
But, builder KB Home (NYSE: KBH) has a bit of a secret weapon. Its homes, designed in part by Martha Stewart, are still selling relatively well. The Stewart homes are only 5% of KB's sales, but as The Wall Street Journal points out [subscription required]: "From March through June 15, the two Martha Stewart developments alone drew 42% of the people who visited KB's 22 subdivisions in the Atlanta metro area."
Some buyers, it seems, want the homes because they believe that Stewart signifies "class". Others think the homes will have better resale values.
The venture may offer a bright spot of the entire industry. Nothing will get home sales back on track except a major upturn in the market. But, the idea of home builders selling new inventory in celebrity partnerships may have a future.
The Elvis Presley model may be on the market sooner than people think.
Douglas A. McIntyre is a partner at 24/7 Wall St.
Posted Jul 10th 2007 6:20PM by Kevin Kelly (RSS feed)
Filed under: SEC Filings
In a
13-G filing made yesterday, hedge fund Moore Capital declared a 1.99 million share position in
Beazer Homes (NYSE:
BZH), good for roughly 5.1% of the company. Although Moore was started by legendary global macro trader Louis Bacon, there are now several different strategies and funds operating under the "Moore Capital" name. I'd argue that the Beazer position is attributable to some sort of value-oriented group at Moore, although Moore seems to have a pro-homebuilding macro-like thesis as the portfolio owns a position in the home builder ETF
XHB according to the
Stokpickr! page on the fund.
The value-thesis behind BZH seems to be rather clear, at least in my eyes. All of the multiples for the company make any contrarian-minded value investor salivate, especially the .57x book value multiple. However,
yesterday's WSJ "Heard on the Street" column ($) made it clear that book value is losing its importance in signifying value in home builders because it is losing its accuracy. BloggingStocks's Zac Bissonnette gave an
interesting take on the piece.
Continue reading Moore Capital gets busy in Beazer Homes
Posted Jun 28th 2007 3:30PM by Eric Buscemi (RSS feed)
Filed under: Rumors, Scandals, D.R.Horton (DHI)
.gif)
Beazer Homes USA Inc (NYSE:
BZH): House of Cards?
Home builder Beazer said in a regulatory filing yesterday that it terminated its Chief Accounting Officer for violating the company's ethics policy. Beazer said it fired Michael T. Rand after an internal probe of the company's mortgage origination business. The Atlanta-based company said the action was taken by its board and management after saying Rand violated the company's ethics policy by attempts to destroy documents.
The country's sixth largest home builder is currently under investigation by the FBI and is the subject of several lawsuits. Earlier this year, media reports noted that the company was under federal investigation for alleged mortgage fraud, a charge Beazer has vehemently denied. In May, it announced the SEC was conducting an informal inquiry to determine if the company, or its employees, had violated any securities laws.
Rand's firing is bad news for the Atlanta company, particularly because of the FBI investigation. JP Morgan analyst Michael Rehaut said that Rand's termination "raises red flags regarding the content of the documents in question." It is unclear whether the allegations against Rand will become part of the investigation.
Rand is the second senior official to be fired at Beazer this year. The company dismissed Kenneth Gary, its general counsel, in February for "a pattern of personal conduct" that included violations of company policies. Former CFO James O'Leary resigned from Beazer in March. Shares of the company, whose competitors include
D.R. Horton Inc (NYSE:
DHI) and
Pulte Homes, Inc (NYSE:
PHM), fell nearly 8% on yesterday's announcement; shares have fallen more than 40% this year.
Who's responsible for the company's troubles? Rand, the others, or is the company looking for scapegoats?
Posted Mar 28th 2007 10:22AM by Eric Buscemi (RSS feed)
Filed under: Bad News, Industry
.gif)
Beazer Homes USA Inc (NYSE:
BZH), following in the footsteps of other home builders, has been reporting awful results. However, to add more fuel to the fire, a report by the
Charlotte Observer wrote the FBI and the U.S. attorney's office in Charlotte, N.C., along with the Internal Revenue Service and the U.S. Department of Housing and Urban Development, launched an investigation of Beazer Homes last week. OUCH!
Everyone is going after this homebuilder. This is as bad as the political backlash following the tech bubble imploding which led to Sarbox.
Look for other district attorneys around the country to start going after other homebuilders and their relationships with mortgage brokers and lenders. Do you think homebuilders reduced lending standards in order to get rid of excess inventory? Why not when you can dump the loan in the secondary market.
The housing industry is getting uglier and uglier, as we have been blogging about for a long time. No need to bottom fish yet. Wait for the political backlash to crescendo before looking at this group again.
Next Page >
Bonds Are a 'Safe' Investment: A Big Lie Gets Even Bigger
Walmart's New Health Food Push: Is It Too Hard to Swallow?
With a turn of the calendar page, we drift into the middle portion of the current quarter, but the earnings season rolls on. Among the many companies scheduled to report quarterly results this coming week are 
Goldman Earnings Sink After Buffett Dividend
Johnson & Johnson's Income Falls 23%
Burberry Shares Leap on Sales Update
