Do You Believe In The Housing Rebound Now?

Includes: DHI, LL, MTH, TOL, TTC, WSO, XHB
by: Bill Gunderson

I still hear pundits on TV almost every day discounting the rebound in housing.

I see articles all of the time that are warning me to not get fooled by the rise in housing stocks, it is not real they say, it is all an illusion.

Shares of Horsham, Pa., based Toll Brothers (NYSE:TOL) are up 49% over the last 12 months and have averaged almost 20% per year over the last three years.

Data from Best Stocks Now app

Of course, it is one thing to look at the past. Investing is all about the future. Toll Brothers is still one of my favorite stocks with an overall Grade of "A-".

Moving further west, the shares of Fort Worth, Texas, based D R Horton (NYSE:DHI) are up 61% over the last 12 months. They continue to hit new highs, but then again, it is all smoke and mirrors (wardrobe mirrors?)

Data from Best Stocks Now app

D R Horton is still one of my favorite stocks. It is also still carries an overall grade of "A-". This represents the top 6% of the entire market.

The shares of Scottsdale, Ariz., based Meritage Homes (NYSE:MTH) are up 75.3% over the last 12 months. According to the latest Case-Schiller index, home prices are up 23% year over year in the Phoenix area. But it is all a mirage in the sun-soaked desert.

Data from Best Stocks Now app

Meritage is also still one of my favorite stocks right now. It currently earns an overall grade of "A" and it is ranked #98 out of 3,297 stocks that I have in my database.

Data from Best Stocks Now app

I require performance, valuation and a healthy stock chart in the positions that I own. Meritage also has a very healthy stock chart right now. Is the chart another illusion? I recently wrote about Meritage.

I started writing about this whole rebound in housing a long time ago. I said it was for real, but I had many detractors.

How do you argue with 100-year low interest rates and a FED that is committed to being accommodative for as far as the eye can see?

The Housing Sector, as measured by the exchange traded fund (NYSEARCA:XHB) continues to be the leading sector in the market, yet pundits continue to warn me to not be fooled.

Data from Best Stocks Now app

It's not just the homebuilders, it's just about every other sector or company that is related in one way or another.

I have featured Toro (NYSE:TTC) on my daily show, many times in the past. The company makes the sprinkler systems that help to beautify your new home. The stock continues to hit new highs.

I have recently featured an Air Conditioning stock by the name of Watsco (NYSE:WSO). What does A/C have to do with the housing market? Just ask the folks in Phoenix.

The stock continues to hit new highs.

I have also featured Lumber Liquidators (NYSE:LL) numerous times, both in print and on my show. It continues to be one of the hottest stocks in the market.

Clients of Gunderson Capital Mgt. are long TOL, DHI, MTH, XHB, TTC, WSO, and LL.

Maybe you have been fooled by the pundits once, but don't be fooled again.

Disclosure: I am long DHI, TTC, LL, WSO, MTH, XHB, TOL. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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