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iShares U.S. Home Construction ETF (ITB)

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  • Mon, Feb. 23, 10:51 AM
    • Existing home sales fell more than forecast in January, sliding to the lowest seasonally-adjusted annualized rate since April.
    • Previously: Treasury yields head south following soft home sales report (Feb. 23)
    • Compass Point throws in the towel on its Outperform calls on Standard Pacific (SPF -1.2%) and Beazer Homes (BZH -1.4%), downgrading both to Neutral.
    • ETFs: ITB -0.7%, XHB -0.15%
    • Toll Brothers (TOL -0.5%), Lennar (LEN -1%), Hovnanian (HOV -2.5%), PulteGroup (PHM -0.7%), Ryland (RYL -1.3%), D.R. Hoton (DHI -0.8%).
    | 4 Comments
  • Tue, Feb. 17, 11:34 AM
    • The NAHB Housing Market Index slipped to 55 in February, it's poorest showing since October, but sill above the expansion/contraction level of 50.
    • Breaking it down by regions, the Northeast actually posted a 5-point improvement to 48, but the Midwest had a big 10-point fall to 49. The West and and South were roughly unchanged. The only other month since 2004 were sentiment fell so far in the Midwest was February of last year ... got to be the weather.
    • The traffic subindex (for all regions) fell to 39 from 44.
    • ITB -0.3%, XHB -0.15%
    • Previously: Builder confidence slips in February (Feb. 17)
    | Comment!
  • Fri, Feb. 6, 3:05 PM
    • With the 10-year Treasury yield ahead by 12 basis points to 1.94% and short-term interest rate futures moving quickly to price in one more rate hike this year, the homebuilder names are instead choosing to focus on the strongest 3-months of job growth in this country in nearly 20 years.
    • Previously: Rate hike expectations to shift after big jobs report? (Feb. 6)
    • The ITB is up 1.95% and the XHB - more weighted towards suppliers rather than homebuilders - is up 0.6%.
    • Toll Brothers (TOL +0.9%), Lennar (LEN +3%), Hovnanian (HOV +1.7%), Ryland (RYL +1.7%), D.R. Horton (DHI +2.2%), KB Home (KBH +2.8%).
    • Standard Pacific (SPF +5.7%) is the strongest of the bunch after beating Q4 estimates last night. Net new orders of 978 in Q4 rose 11% Y/Y, with the ASP up 10% to $491K.
    • Previously: Standard Pacific beats by $0.01, beats on revenue (Feb. 5)
    | 4 Comments
  • Thu, Jan. 29, 10:18 AM
    | 2 Comments
  • Tue, Jan. 27, 10:20 AM
    • December new home sales coming in at a seasonally adjusted annualized rate of 481K was the strongest print since June 2008, notes the WSJ's Nick Timiraos, but the 2014 total of 435K only edged higher from 2013's 429K.
    • In 2007, new home sales totaled 776K. At the bottom in 2011, they were 306K.
    • ITB -1.2%, XHB -0.6%
    • Previously: New home sales strong in December (Jan. 27)
    | 2 Comments
  • Mon, Jan. 26, 10:49 AM
    • D.R. Horton (DHI +7.4%) earlier reported FQ1 (ending Dec. 31) results which beat estimates and also said the sales pace has picked up in January.
    • On the earnings call, management guides for 2015 gross margins of roughly 20% - earlier this month, both Lennar and KB Home warned on margins in 2015.
    • ITB +1.7%, XHB +1.3%
    • Lennar (LEN +2.7%), KB Home (KBH +1.7%), Toll Brothers (TOL +1.4%), Hovnanian (HOV +2.2%), PulteGroup (PHM +1.9%), Ryland (RYL +1.5%)
    | 4 Comments
  • Wed, Jan. 21, 8:46 AM
    • December housing starts of 1.089M were up 4.4% from November and 5.3% from a year earlier. Single-family starts of 728K gained 7.2% from November.
    • Building permits of 1.032M actually fell 1.9% from November, but were 1% higher than a year ago. Single-family permits of 667K were up 4.5% from November, and multi-family permits fell 12.4%.
    • Full report
    • ETFs: ITB, XHB
    | Comment!
  • Tue, Jan. 20, 9:43 AM
    • Hovnanian (HOV -5%), M/I Homes (MHO -3.1%), and Taylor Morrison (TMHC -4.3%) are all cut at JMP Securities, with MHO and TMHC now Market Performs, and HOV now Underperform.
    • Credit Suisse, meanwhile, also cuts Taylor Morrison. Alongside, the team downgrades Ryland Group (RYL -3.2%), Meritage Homes (MTH -3.4%), and PulteGroup (PHM -3.3%) to Underperform, noting margin declines (see KB Home and Lennar earnings) and a slowdown in Texas thanks to oil's plunge.
    • There's one upgrade, and that's NVR (NVR), which is boosted to Neutral from Underperform at Credit Suisse.
    • ETFs: ITB, XHB
    • Previously: KB Home: "Work to be done" to meet goals; -12.6% (Jan. 13)
    • Previously: Lennar leads homebuilders lower after earnings (Jan. 15)
    | 1 Comment
  • Thu, Jan. 15, 11:31 AM
    • The company earlier reported bottom-line results which beat estimates, but the top line slightly missed.
    • FQ4 (ending Nov. 30) deliveries of 6,950 homes gained 23% from a year ago. New orders of 5,492 homes up 22%, up 24% in dollar terms. ASP of $329K vs. $307K a year ago. Incentives of 23.1K per home, or 6.6% of home sales revenue vs. $20.6K and 6.3% a year ago.
    • Backlogs of 5,832 homes up 21%, up 22% in dollar terms.
    • Gross margins of 25.6% fell 120 basis points from a year ago. Operating margin of 16% down 90 bps.
    • Like KB Home earlier this week, Lennar (LEN -4%) warns of lower gross margins for fiscal 2015.
    • ITB -2.9%, XHB -2.2%
    • Toll Brothers (TOL -2.7%), Hovnanian (HOV -5.3%), D.R. Horton (DHI -4.9%), Ryland (RYL -4.7%), KB Home (KBH -5.5%), Pulte (PHM -4.3%) M.D.C. Holdings (MDC -5.9%), NVR (NVR -2.5%), Standard Pacific (SPF -3.2%)
    • Previously: Lennar beats by $0.11, misses on revenue (Jan. 15)
    | 3 Comments
  • Tue, Jan. 13, 12:03 PM
    • Demand in some of its markets deteriorated as Q4 progressed, says KB Home (KBH -12.6%) management on the earnings call, and gross margins in Q1 are expected to be down "significantly" from the year-ago level.
    • Pressed by analysts on the comments, management says it expects Q1 will be a low point for the year, with sequential improvement to follow. Not wanting to put too fine of a number on what it expects margins to be this year, management says achieving the 20% long-term target is unlikely.
    • Webcast here
    • Previously: Homebuilders whacked as KB Home starts earnings call (Jan. 13)
    • ETFs: ITB -1.5%, XHB -0.3% - XHB's better performance reflects its higher focus on building suppliers, rather than homebuilders.
    | Comment!
  • Tue, Jan. 13, 11:48 AM
    • Up earlier after reporting a strong FQ4, KB Home (KBH -12.2%) goes into the tank as the earnings call begins and management warns on margins.
    • Webcast here
    • Some homebuilders are red, some are green, but all are well off session highs in sympathy: Hovnanian (HOV -2.7%), D.R. Horton (DHI -2.3%), Toll Brothers (TOL +0.3%), PulteGroup (PHM -0.6%), Ryland (RYL +0.2%)
    • ETFs: ITB, XHB
    • Previously: KB Home up 4.4% after strong FQ4 results (Jan. 13)
    | 4 Comments
  • Wed, Jan. 7, 11:04 AM
    • Bloomberg is reporting the president as set to announce a 50 basis point reduction in FHA fees to 0.85% at an event in Phoenix tomorrow. The news isn't good for private mortgage insurers who have been happily raking in market share gains at the expense of the government agency, but the homebuilders are a different story.
    • Previously: Mortgage insurers tumble on report of cut in FHA premiums (Jan. 7)
    • ETFs: ITB +3%, XHB +2.5%
    • Toll Brothers (TOL +2.7%), Lennar (LEN +3.8%), D.R. Horton (DHI +4%), Ryland (RYL +2.9%), KB Home (KBH +2.5%), Hovnanian (HOV +3.6%), PulteGroup (PHM +3.9%).
    | 2 Comments
  • Dec. 31, 2014, 8:43 AM
    • Among the more interesting is the idea of North Korea hackers attacking the infrastructure of the NYSE and Nasdaq, precipitating a gigantic one-hour drop in stocks.
    • Others include: 1) Significantly higher Apple (NASDAQ:AAPL) estimates, making it the first $1T market cap company, the best-performing large-cap in 2015, and a "must own." 2) Falling home prices in H2, making shorts of homebuilders (ITB, XHB) a good play 3) Bank stocks (NYSEARCA:XLF) have a hard time of it 4) Calling Twitter (NYSE:TWTR) his new Netflix, Carl Icahn amasses a sizable position, forcing a bidding war for the company between Google and Facebook 5) Google (NASDAQ:GOOG) becomes more shareholder friendly, cutting spending and launching a buyback program 6) Activists take aim at Cisco (NASDAQ:CSCO), forcing John Chambers out 7) Berkshire Hathaway (BRK.A, BRK.B) makes its largest-ever acquisition, and its not in consumer goods, but instead in energy, retail, or construction/equipment.
    • The full piece is here.
    | 43 Comments
  • Dec. 23, 2014, 10:15 AM
    • November new home sales at a seasonally adjusted annual rate of 438K were off 1.6% from the previous month, and also lower by 1.6% from a year ago.
    • A longer-term chart shows the current amount of new home sales to be at a level associated with the bottom of the deep recession of the early 1990s. There's also a pretty wide divergence between the confidence level of homebuilders (surging upward) and the path of new home sales.
    • ITB +0.7%, XHB +0.9% on today's session.
    • Previously: New home sales disappoint in November (Dec. 23)
    • Full report
    | 4 Comments
  • Dec. 10, 2014, 3:53 PM
    • "Why 2014 was a pause and flat to 2013 and not improving has been a bit puzzling," says Toll Brothers (TOL -7.6%) management on the earnings call.
    • Asked about the impact of tumbling energy prices on markets like Dallas and Houston, management says the company's exposure there is small, with Houston accounting for 3.7% of signed contracts.
    • Overall, Toll expects the housing recovery to be "bumpy," and that demand will truly return when buyers no longer fear price drops.
    • Previously: Toll Brothers slips on FQ4 miss (Dec. 10, 2014)
    • It's a different story (at least for the stock price) with Hovanian (HOV +5.9%) after its earning report today. Management: "It's an understatement to say that the past 12 months have been choppy ... Given the gains we've seen in employment, we would have expected stronger home sales."
    • Previously: Hovnanian pops as fiscal 2015 starts off strong (Dec. 10, 2014)
    • Other builders today: Ryland (RYL -5.1%), Lennar (LEN -5.3%), Beazer (BZH -5.1%), Pulte (PHM -3.5%), KB Home (KBH -5.1%).
    • ETFs: ITB -3.4%, XHB -2.5%
    | 3 Comments
  • Dec. 8, 2014, 12:53 PM
    • “There is a group of millennials that are waiting out there to jump into the market that do have the ability to repay,” say FHFA officials on a call announcing official approval of 97% LTV mortgages.
    • Fannie Mae (OTCQB:FNMA -2%), which has more experience with the program, is already accepting applications, but Freddie Mac (OTCQB:FMCC -2.1%) - newer to the product - is waiting until late March for full implementation.
    • Homebuilder ETFs: XHB, ITB
    | 7 Comments
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The iShares Dow Jones U.S. Home Construction Index Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Dow Jones U.S. Select Home Construction Index.
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