We saw here with Orleans Homebuilding (OHB) that markets can be fairly adept at figuring out whether book values will increase or decrease, but that they tend to overshoot their marks, offering buy opportunities when they overshoot to the downside. But was Orleans a one-off? Let's look at a few more builders to see if there's a common theme emerging.
This one is a bit perplexing, with market values taking a huge plunge in the early nineties. Market value continues to underperform book throughout the 2000s (until a bout of irrational exuberance in 2004), suggesting that for some reason investors were turned off by this company. I'd be interested to dig into why this was trading at such a sharp discount.