Homebuilder Performance and Revenue Matrix

Much to many investors' surprise, homebuilder stocks have been strong performers so far in 2008. The S&P 1,500 Homebuilder group is up 15.5% year to date, and many stocks in the group are up 25% or more. As shown below, MHO, SPF and HOV are each up over 65%, PHM is up 40.7% and MTH is up 39.8%.

We created a matrix that highlights the 2007 regional revenue breakdown (data from Bloomberg) for some of the key stocks in the group. The darker the green shading, the bigger the regional revenues for each stock. Each company has different ways of categorizing their revenues, so unfortunately there isn't a standard North/South/East/West breakdown.

When analyzing the matrix, remember that California, Nevada and South Florida have taken the biggest hits in terms of real estate prices, while the Northeast, Mid-Atlantic and the Farm Belt have held up the best. From the matrix, it seems that NVR, HOV, TOL and MHO have stayed away from the West Coast the most.

click to enlarge

Comments

[tuj:]

HOV builds in Texas and CA

2008 Apr 22 07:13 AM

[Rhett:]

THe law of gravity has been repealed!

2008 Apr 22 09:07 AM

[pochovilla:]

Gravity still exists. It's the hot air in the paper paper balloons that's has limited supply in spite of Congressional efforts. I think the high rise condo's in Miami would make wonderful housing for the homeless if only the FED can arrange the financing and we just ignore the maintenance costs for awhile. Keep this stuff off the books and just use emergency appropriations bills. 1000 peso notes would be used as collateral.

2008 Apr 22 11:17 AM

[karchad:]

Darned, articles like this are going to spoil my gains and blow my cover! This is the first article to point out that homebuilders are up for the YTD. While everyone else is focused on the news, these stocks are moving up.
What I need is a return to utter negativity, reciting the awful statistics, and telling me that I was crazy for going into this sector on 1/2/08. Only then can my gains continue. Come on SeekingAlpha readers, bring it on with those gloomy posts!

2008 Apr 22 01:49 PM

[farfignewton:]

The market has been defying logic for quite sometime now... This is a perfect example.

2008 Apr 22 03:14 PM

[karchad:]

farfignewton, i dont think it's defying logic.... the homebuilders began declining as early as 2006, when the housing market was fantastic, going thru the roof. The market is always ahead of the stats. Most people say 6 months, but in this case, it's more than a year. i remember when the junk bond market began to collapse in 1998. I think that was a predictor of the market collapse in 2000, which predicted the recession of 2001-2.

2008 Apr 22 04:41 PM

[Not Worth T...:]

The cycle is almost bottom, and sometimes we can also be surprised by how fast things change too. We cannot point to a bottom until one is formed, for me, I bought in Feb 2008 HOV and I said to myself I must be crazy. Yet, the last time we had tech bubble, I kicked myself for not buying in Yahoo when it was below 10 a share. I still remember that day that I was off from work and was looking at the market the entire morning and I though Yahoo could go down more and everyone else was saying gravity would pull Yahoo further down. I listened just when everyone was saying the same thing.

2008 Apr 22 09:16 PM