Oh, that's it, it's the smell of PANIC in the air!
No, Osman, it's never different this time
No, Bob Toll, there isn't an endless supply of suckers
No, NAR and David Lereah, past performance does not guarantee future returns
No, The Banker, home builder and real estate industrial complex stocks are not a good long term bet
No, realtors, you're really not needed anymore
No, appraisers, it's not ok to take kickbacks from realtors and mortgage bankers
No, Greenspan, it wasn't a great idea to keep interest rates so low for so long
Hovnanian Warning Spells Trouble for Builders
As Hovnanian Enterprises Inc. (HOV) prepares the market for lower results in the months ahead, analysts are wondering whether its future financial performance may turn out even worse than the home builder expects.
Hovnanian on Monday cut fiscal second-quarter and 2006 earnings guidance and said it plans to take writedowns in connection with falling land values as the company struggles with a faster-than-expected drop in the housing market.
The company's fiscal quarter, which includes the month of April, appears to indicate that housing demand has fallen faster and more sharply than expected, prompting some analysts to wonder if Hovnanian's 2006 earnings could fall even lower than the company's revised guidance.
Hovnanian's stock fell sharply on the news, recently trading at $35.76, down $3.02, or 7.8%.
May 02, 2006
Hmmm... What's that smell... I recognize it from somewhere...
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16 comments:
Faster and steeper than anyone predicted.
We are going to hear this more than we used to hear soft landing.
Agreed!
Every time I read something like thisI thank God that I found this site!
Is this the soft landing they keep talking about? So far only CTX and HOV has confessed. The rest of the homebuilders are still in denial. Bob Toll said to bring on the 7% mortgage rates. Let him have it with both barrels
Aooga, Aooga, Dive, RE. Dive!!!!!!
MWAHAHAHAHAHAHA!!!!!!!!!
Nice graph...Yerkes-Dodson Law...haven't seen that in a while.
St. Joe Company profits down 76%. Stock hits 52 week low.
This is the biggest landowner in Florida, and one of the biggest builders.
Are there any business other than construction, appraisers, realtors, home inspection company, building supply, funiture retailer and manufacturer, pool installers, landscapers, architects, maid services, mortgage lenders, or laborer that will be affected by a real estate slow down???
Any other businesses to be affected?!? Which one's won't be affected. Ever see those "Daisy Cutter Bomb" videos? Ameriquest is going virtual. 3800 high paid replaced by hundreds in India. BMW leasing in OC just went south. BMWs come in at Port Hueneme. Big hit there. This is top of the food chain stuff.
keith - if you are so good and smart, how come you didn't recommend we short CTX and HOV when you made your short recommendations last month?
clarification....
Before he went away in Feb, The Banker did not say that home builder and real estate industrial complex stocks are a good long term bet.......
The Banker said that investing in the opposite direction of what Keith the blog hosts says is a good long term bet....
"if you are so good and smart, how come you didn't recommend we short CTX and HOV when you made your short recommendations last month?"
bottom line is that the homebuilders already got a 50% haircut last fall/this winter. the easy money shorting was made
now, there's major manipulation and insider money that will kill shorts some days. other days, the reality will kill the longs. best to be in something else, than this dangerous sector
my picks as everyone knows: gold, oil and foreign funds
even though the idea of shorting home depot and loews is really tempting... we'll see
Short any homebuilder that hasn't warned yet. KBH PHM MDC DHI TOL SPF MTH
where is The Banker?
TOL is set to warn this Fri 5/5
Shorting HB's indiscriminately may be a recipe for disaster. Some will hold out better than others.
I shorted Six Flags, the amusement park company a couple of weeks ago. Either people can pay up to fill the tank to drive there but have no money left for the admission tickets, or they can buy the tickets with no way to pay for gas to get to the parks. If you've ever gone to one of these parks and looked at who's there, you know these people have a mobile home payment to make as well.
6 Flags is gonna have a losey summer. PKS
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