Homebuilder Centex Swings to Q4 Loss

U.S. homebuilder Centex Corp. reported a wider-than-expected fiscal Q4 loss Monday as the housing downturn continues to hit revenue. The company posted a loss from continuing operations of $22.3 million (-$0.18/share) versus its earlier forecast of break-even. Analysts were expecting a loss of -$0.03. Last year the company earned $369 million ($2.86) in Q4. The results reflect land impairment charges of $202 million, or $1.01 a share. They do not, however, reflect earnings from discontinued operations of $221.1 million related to the company's construction services business, sold off in March, and some home equity operations. Including those profits, the company posted net income of $198.9 million ($1.60/share), down from $391.8 million ($3.04) a year earlier. Revenue dropped 11% in the quarter to $3.67 billion against analyst expectations of $3.34 billion, while closings fell 14% in what the company calls "one of the most difficult markets in 25 years." Shares dropped 2.7% yesterday and were down another 1% in AH trading to $44.77.

Sources: Press release, MarketWatch, TheStreet.com, Reuters
Commentary: Contrarian Investors Seek Value in Housing • Ten Stock Picks From Barbara Marcin of Gamco Investors • Is It Time to Buy the Homebuilders? 13 Stocks to Consider
Stocks/ETFs to watch: Centex Corp. (CTX). Competitors: Pulte Homes Inc. (PHM), DR Horton Inc. (DHI), Lennar Corp. (LEN). ETFs: iShares Dow Jones US Home Construction (ITB)

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