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Steve Hach
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Steve Hach is the Senior Editor at ValuEngine.com, a Newtown, Pennsylvania-based stock valuation and forecast service. ValuEngine utilizes Ivy League financial research as the basis for its coverage of more than 7000 US, Japanese, and Canadian, and other foreign stocks. Hach utilizes... More
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  • ValuEngine.com Rates the Home Builders 0 comments
    Aug 23, 2011 3:06 PM | about stocks: AXR, BZH, CHCI, DHI, HOV, KBH, LEN, MDC, MHO, MTH, NVR, PHM, RYL, SPF, TOL

    ValuEngine.com Rates the Home Builders

    The housing market continues to struggle as news today indicates that new-home sales fell during July to the lowest level in five months. Sales decreased by 0.7% on a monthly basis to a seasonally adjusted annual rate of 298,000. THis is the worst number since February. Sales figures for JUne were also revised downward to a bigger decline--2.9% vs the 1% originally reported. The annual rate of 298,000 is far below the "healthy" rate of @750,000 sales annually.

    The housing market is still being battered by tight credit, increased lending standards, and a wave of foreclosures, short sales, etc. New Homes face particular problems because existing homes as well as those being sold under duress are providing cheaper alternatives for those able to secure financing. 

    Below, we provide our Critical VE data points for the Home Builders*

     

     

    Ticker
    Name
    Mkt Price
    Valuation(%)
    VE Rating
    Last 12-M Retn(%)
    Forecast 1-Yr Retn(%)
    1-Yr Chance of Gain(%)
    P/E Ratio
    AXR
    AMREP CORP
    7.31
    -54.64
    1
    -37.04
    -19.42
    42.95
    66.45
    BZH
    BEAZER HOMES
    1.5
    -75
    4
    -59.46
    6.11
    52.23
       
    N/A
    CHCI
    COMSTOCK HMBLDG
    1.04
       
    N/A
    2
    -32.9
    -10.92
    46.59
       
    N/A
    DHI
    D R HORTON INC
    8.95
    -45.28
    3
    -11.65
    0.58
    50.42
       
    N/A
    HOV
    HOVNANIAN ENTRP
    1.48
    -75
    3
    -61.86
    1.26
    50.54
       
    N/A
    KBH
    KB HOME
    5.43
    -75
    5
    -45.54
    218.56
    100
       
    N/A
    LEN
    LENNAR CORP -A
    12.71
    -57.79
    3
    0.39
    3.21
    52.27
    40.94
    MDC
    MDC HLDGS
    16.86
    -56
    3
    -33.78
    3.05
    53.36
       
    N/A
    MHO
    M/I HOMES INC
    6.21
    -69.09
    3
    -35.91
    -0.07
    49.96
       
    N/A
    MTH
    MERITAGE HOMES
    15.44
    -45.41
    2
    -9.97
    -5.63
    46.16
       
    N/A
    NVR
    NVR INC
    597.17
    -25.56
    3
    -4.54
    2.94
    53.4
    22.38
    PHM
    PULTE GROUP ONC
    3.76
    -75
    3
    -53.23
    4.49
    53.09
       
    N/A
    RYL
    RYLAND GRP INC
    9.55
    -66.44
    3
    -40.54
    2.6
    52.02
       
    N/A
    SPF
    STANDARD PAC
    2.22
    -75
    3
    -36.75
    2.67
    51.26
    932.25
    TOL
    TOLL BROTHERS
    14.9
    -37.24
    3
    -10.08
    -1.24
    48.67
       
    N/A

     

    *NOTE:  KBH recently had some adjustments to EPS which has skewed the Forecast Model's calculations.  This sort of extreme forecast is an anomaly. ValuEngine Ratings cover approximately 6,000 stocks. ValuEngine's stock recommendations are based on the proprietary ValuEngine Forecast Model calculations for each individual equity. A stock is rated Strong Buy, Buy, Hold, Sell, Strong Sell based on the One Year Forecast Return (1YFR). The breakdown for each rating is as follows:  Strong Buy: More than +12% 1YFR,  Buy: Between +5% and +12% 1YFR, Hold: Between -5% and +5% 1YFR, Sell: Between -12% and -5% 1YFR, Strong Sell: Less than -12% 1YFR. ValuEngine’s Valuation and Forecast data are derived from our proprietary quantitative models and consider numerous factors including: firm-specific variables like the Long-run EPS growth rate, the Duration of the Business-growth-cycle, the Volatility of EPS growth rate, the Systematic or beta risk of the firm, the Correlation between the firm's EPS and the interest rate environment, Dividend payout ratio, and Buffer earnings. Model calculations also include interest rate-related criteria as well as technical data such as short and long-term price reversal characteristics.

     

    Market Indices Data
    Index
    Latest
    Change
    YTD
    Dow Jones
    11,052.00
    197.31
    -4.54%
    NASDAQ Composite
    2,398.64
    53.26
    -9.58%
    Russell 2000
    661.47
    10.13
    -15.59%
    S&P 500
    1,146.67
    22.85
    -8.82%

     

    ValuEngine Market Overview
    Summary of VE Stock Universe
    Stocks Undervalued
    88.89%
    Stocks Overvalued
    11.11%
    Stocks Undervalued by 20%
    63.14%
    Stocks Overvalued by 20%
    4.08%
    ValuEngine Sector Overview
    Sector
    Change
    MTD
    YTD
    Valuation
    Last 12-MReturn
    P/E Ratio
    Utilities
    0.06%
    -8.28%
    -6.34%
    10.14% undervalued
    9.58%
    24.70
    Transportation
    -0.27%
    -16.80%
    -20.83%
    17.30% undervalued
    -4.08%
    15.89
    Consumer Staples
    -0.43%
    -12.66%
    -17.03%
    17.46% undervalued
    5.01%
    16.54
    Basic Materials
    0.27%
    -14.05%
    -18.76%
    22.76% undervalued
    30.64%
    24.57
    Retail-Wholesale
    0.50%
    -14.86%
    -9.25%
    23.09% undervalued
    14.15%
    21.85
    Finance
    -0.12%
    -13.61%
    -13.38%
    23.37% undervalued
    0.10%
    22.71
    Oils-Energy
    -2.07%
    -20.55%
    -21.65%
    23.95% undervalued
    21.39%
    45.00
    Business Services
    0.04%
    -16.23%
    -13.80%
    24.65% undervalued
    6.68%
    20.61
    Aerospace
    0.93%
    -13.42%
    3.54%
    24.69% undervalued
    7.26%
    18.54
    Multi-Sector Conglomerates
    -0.04%
    -16.68%
    -18.79%
    25.52% undervalued
    8.33%
    20.43
    Medical
    -0.43%
    -14.85%
    -9.26%
    27.85% undervalued
    3.39%
    27.10
    Consumer Discretionary
    -0.36%
    -16.78%
    -16.59%
    28.16% undervalued
    6.53%
    29.62
    Industrial Products
    -0.02%
    -17.06%
    -17.90%
    28.59% undervalued
    11.56%
    17.87
    Computer and Technology
    -0.09%
    -17.23%
    -15.15%
    28.61% undervalued
    8.56%
    35.58
    Construction
    -1.00%
    -19.34%
    -29.25%
    31.07% undervalued
    -12.50%
    37.55
    Auto-Tires-Trucks
    -0.47%
    -24.13%
    -33.63%
    34.10% undervalued
    6.39%
    14.25

     

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