Aug. 20, 2013, 5:30 PM
Aug. 19, 2013, 12:13 PM
- Off more than 20% since its May high, the iShares U.S. Home Construction ETF (ITB -1.6%) is officially in a bear market, notes Ryan Detrick. The previous 3 instances the ETF fell 20%, it declined another 7.7% in the following month.
- Know your ETF: The S&P Homebuilders ETF (XHB -0.8%) has strongly outperformed the ITB during this 3-month slump.
- While ITB's main holdings are concentrated in actual homebuilders like LEN, PHM, DHI, TOL, and NVR, top holdings in the XHB are supply companies like Lumber Liquidators, Lennox, Lowe's/Home Depot, and A.O Smith - a homebuilder can't be found in its top 10 names.
- Other related ETF: PKB.
Aug. 16, 2013, 12:48 PM
- Struggling home builders are jumping ahead on respectable but in-line housing data, as at least overall construction has climbed in two of the past three months.
- "Looking at the underlying trend in one-family starts suggests that the pace of groundbreaking activity is actually fairly steady," an RBS economist says, unconcerned about July's drop in single-family starts since "anecdotal evidence suggests builders may be holding back on new construction in part to reap the benefits of higher prices."
- Raymond James "continue[s] to believe we are in the early stages of a sustainable up-cycle in U.S. housing," and favors Toll Brothers (TOL +1.5%), which it sees as less sensitive to mortgage rates.
- PHM +3.4%, LEN +3.1%, KBH +2.9%.
- ETFs: XHB, ITB, PKB, REZ.
Aug. 16, 2013, 8:41 AM
- Weeding out volatile multiple-family figures, July single-family starts of 591K fell 2.2% from June's revised figure of 604K. The 591K print is the lowest since last November as higher interest rates sap some of the market's energy.
- July building permits of 943K is 2.7% above June's revised rate of 918K.
- A few homebuilders premarket: TOL +0.7%, LEN +0.6%, PHM +1.2%.
- Homebuilder ETFs: XHB, ITB, PKB.
- Full report.
Aug. 15, 2013, 11:40 AM
- The NAHB builder sentiment index rises to nearly an 8-year high of 59 in August - the last time it was higher was 61 in November 2005. The move comes with the pace of new home sales nearing 500K annually, 38% higher than a year ago, but off from the 700K consistent with a healthy market.
- The HomeBuilders ETF (XHB -0.4%) continues its summer decline, though it has bounced significantly since the NAHB print hit the tape.
- Other ETFs: XHB, ITB, PKB.
- A few stocks: Toll Brothers (TOL +2%), M/I Homes (MHO +3%), Hovnanian (HOV +1.7%), Pulte (PHM +2.2%), Lennar (LEN +3.1%), Ryland (RYL +1.3%), Beazer (BZH +2.9%).
Jul. 25, 2013, 11:42 AMThe Homebuilders ETFs (XHB -2.6%), (ITB -4.3%) slip after earnings from PulteGroup (PHM -9.3%) and D.R. Horton (DHI -8.2%), with Pulte notable for reporting a big decline in orders (interest rates on the rise again aren't helping). Goldman reiterates its Sell rating on Pulte, noting the need to be selective within the sector. Others: Toll Brothers (TOL -2.4%), KB Home (KBH -5.8%), Lennar (LEN -4.8%), and also reporting M/I Homes (MHO -7.3%), and Ryland (RYL -8.1%). One homebuilder/landowner caught up in the selloff is UCP, Inc. (UCP -2.4%) - a promising play that may be the victim of a poorly-timed IPO, says SA Pro's Money Investor. | 1 Comment
Jul. 22, 2013, 2:58 PMHomebuilders (ITB -1.4%) tumble across the board after existing June home sales slipped a seasonally adjusted 1.2%. Rising mortgage rates were supposed to boost short-term demand as potential buyers aimed to lock in mortgages before rates went even higher, but the June report showed no sign of it. KBH -2.6%, RYL -2.5%, MTH -2.5%, DHI -2.2%, MDC -2.2%, HOV -2%, LEN -2%, PHM -1.6%, TOL -1.4%. | 3 Comments
Jul. 16, 2013, 7:54 AMWith house prices rising, profits healthy and financing available, large publicly traded house-builders such as Lennar (LEN), NVR (NVR) and Toll Brothers (TOL) have been buying up their smaller privately held rivals, which have had trouble getting funding for new developments. Ryland Group (RYL) is onto its third acquisition in a year. To stay independent, some private companies have listed, with three IPOs in the sector taking place since January. | Comment!
Jul. 15, 2013, 3:59 PMLit up bright red on an otherwise quiet day are the homebuilders (XHB -1%). Lennar's (LEN -4.1%) big move puts it down 8% YTD as the benign interest rate scenario of the past many months/years becomes less so. Others: Pulte (PHM -3.3%), Toll (TOL -2.2%), Ryland (RYL -2.6%), D.R. Horton (DHI -4.6%). | 5 Comments
Jul. 5, 2013, 10:07 AM
Jun. 25, 2013, 2:15 PMHome builder stocks are enjoying a good day today on the back of better results from Lennar (LEN), along with above consensus results from Case-Shiller's Home Price Index in April and strong May New Home Sales. Despite the positives, Wells Fargo's Adam Rudiger thinks it's too soon to dismiss the potential impact of rising mortgage rates. The 30-year fixed rate mortgage averaged 3.62% during LEN's Q2, Rudiger notes, well below the 4.51% average rate as of yesterday. | 1 Comment
Jun. 24, 2013, 9:20 AMGoldman Sachs initiates or resumes coverage on several housing plays, recommending Taylor Morrison Home (TMHC), NVR (NVR), M.D.C. Holdings (MDC), KB Home (KBH), D.R. Horton (DHI) and Beazer Homes (BZH) at "Neutral" (I, II, III, IV, V, VI). Goldman resumes Meritage Homes (MTH), Toll Brothers (TOL) and Ryland Group (RYL) at "Buy" (I, II, III) and adds the latter to its Americas Conviction Buy List, but it grades PulteGroup (PHM) as a "Sell," due to growth that lags its peers. | 1 Comment
Jun. 20, 2013, 12:09 PM
Jun. 10, 2013, 9:22 PMLennar (LEN -3.37%) suffered today after a J.P. Morgan downgrade. Morgan analysts lowered the stock to neutral from overweight and lowered the price target from $48 to $46.50, projecting "some modest near term downside risk." Collateral damage to housing stocks included Gafisa (GFA -6.21%),Toll Bros. (TOL -2.95%), Hovnanian (HOV -2.77%), PulteGroup (PHM -1.99%), KB Home (KBH -1.78%). | Comment!
Jun. 7, 2013, 5:42 PMCNBC's Jim Cramer isn't worried so much about Fed tapering anymore. He's watching the 10-year bond. "When the ten-year goes down," Cramer says, "people step in and start buying." Stocks like Whirlpool (WHR), Toll Bros (TOL) banks that are levered to mortgages. If we can get 10-year rates to around 2.01% there, he thinks we could have a big rally. (Video). | 1 Comment
Jun. 4, 2013, 3:47 PMToll Brothers (TOL -1.2%) slips today, despite being upgraded to a Buy by analyst Megan McGrath at MKM Partners. McGrath says that TOL's status as one of the more niche luxury homebuilders may become more valuable as the housing market continues to grow and lower end competition intensifies. She recommends investors buy the shares ahead of H213 as the stock could be pushed higher by the closing of the Touraine building. | 1 Comment
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