Trouble on the Home Front

HenryTo · Posted: Wed Jan 25, 2006 9:14 am Post subject: Trouble on the Home Front

FYI:
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Trouble on the Home Front
By Nicholas Yulico
TheStreet.com Staff Reporter
1/25/2006 9:48 AM EST
URL: http://www.thestreet.com/markets/realestate/10263958.html

Homebuilders Centex (CTX:NYSE) and Ryland (RYL:NYSE) both reported strong quarterly earnings, but their new-order numbers, which will drive future growth, look dismal.

Calabasas, Calif.-based Ryland said its net income rose 49% to $162 million, or $3.32 per share, compared to $108.7 million, or $2.17 per share, a year earlier. The results handily beat the consensus $3.12 estimate on First Call.

But Ryland's unit orders fell 5% year-over-year for its latest quarter. The lackluster performance led A.G. Edwards analyst Greg Gieber to cut his rating on Ryland to sell. He also dropped his 2006 EPS estimate to $10.25 from $10.90. In a research note Wednesday morning, Gieber noted that the only area of strength in Ryland's orders came from Texas, where unit sales were up 27%. However, the average selling price in Texas is 36% below the company's average, with equally low gross margins, he said.

"Using our new 2006 EPS estimate, Ryland currently trades at a 7.3 times multiple. That is a 12% premium to the group's current average 2006 multiple of 6.5 times. We don't believe Ryland warrants any premium to the group," Gieber wrote.

Centex, which reported a 30% increase in its quarterly earnings, reported order growth, but it was weaker than analysts expected.

The Dallas-based builder said its new orders rose 4% to 8,128 homes. Sales were strongest in the Southwest, where orders spiked 28% year over year. On the West Coast, orders rose 10%. But orders fell 15% in the Southeast, 8% in the mid-Atlantic and 3% in the Midwest.

"This is not particularly positive to hit only 4%, though we don't know all the details behind it," says Gieber, who was expecting nearly 11% order growth.

Centex said net income rose to $329.3 million, or $2.49 a share, for its fiscal third quarter ending Dec. 31, up from $253.8 million, or $1.91 a share, a year earlier. Excluding discontinued items, Centex posted earnings of $332.7 million, or $2.52 a share. Analysts expected earnings of $2.48 a share, according to Thomson First Call.

Revenue rose 25% to $3.74 billion, shy of analysts forecast of $3.81 billion.

Centex's earnings growth came amid an 18% increase in home closings, which rose to 9,504 units from 8,047, and a 130-basis-point jump in operating margin.

The weak orders will likely be a focus on both companies' conference calls Wednesday morning. Homebuilder Meritage (MTH:NYSE) will also report earnings today at an unspecified time.

The existing home sales data comes out at 10 a.m. EST from the National Association of Realtors.

rffrydr · Posted: Wed Jun 03, 2009 12:10 pm Post subject:

Took 5% out of High Yield yesterday on the Gross success story and put it in MBB--no biggie, cept for the guy who's got your back:

http://www.bloomberg.com/apps/news?pid=20601087&sid=aWyUhGakPYSg

He said it would be the theme for the coming years.
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rffrydr · Posted: Wed Jun 03, 2009 8:07 am Post subject:

Geithner can't sell his house:

http://www.cnbc.com/id/31082378
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rffrydr · Posted: Fri May 29, 2009 8:57 am Post subject:

"Black Wednesday"

http://www.mortgagenewsdaily.com/mortgage_rates/blog/78362.aspx

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HenryTo · Posted: Fri May 29, 2009 2:28 am Post subject:

Evaluating the trend of housing prices (on a U.S. median housing price basis) as priced in gold:

http://www.chartoftheday.com/20090529.htm?T

We are probably approaching a cyclical low sometime in the next 6 months.

rffrydr · Posted: Tue May 26, 2009 4:16 pm Post subject:

Case on the current report: defies seasonals ("we are only a three months moving average" e.g. ending)

http://media.bloomberg.com/bb/avfile/News/Surveillance/vXNheh9zaUKo.mp3
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HenryTo · Posted: Sun May 24, 2009 3:38 pm Post subject:

Institutional and high net worth investment funds pouring into distressed housing properties in cities such as Phoenix, etc:

http://www.nytimes.com/2009/05/24/business/24phoenix.html?src=linkedin

rffrydr · Posted: Tue May 19, 2009 11:41 am Post subject:

SFR were actually up, the dropoff coming from apartments. The last thing we need now is housing push. We'll write off in the economy what we can't in the banks.
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HenryTo · Posted: Tue May 19, 2009 10:16 am Post subject:

Bullish for housing prices; but bearish for 2Q GDP. That said, we have already written off 2Q GDP:

http://www.ft.com/cms/s/4ec2895e-4474-11de-82d6-00144feabdc0,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2F4ec2895e-4474-11de-82d6-00144feabdc0.html&_i_referer=http%3A%2F%2Fwww.ft.com%2Fhome%2Fus

rffrydr · Posted: Tue May 05, 2009 8:12 am Post subject:

It's a trend:

http://www.nytimes.com/2009/05/05/business/economy/05turnaround.html?_r=1&hp
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rffrydr · Posted: Sun May 03, 2009 10:44 pm Post subject:

LA proper, no trouble here:

http://www.latimes.com/classified/realestate/news/la-fi-cover3-2009may03,0,7623052.story
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rffrydr · Posted: Sun Apr 12, 2009 8:56 pm Post subject:

A new kind of "staging":

http://www.nytimes.com/2009/04/13/us/13burglar.html?_r=1&hp

File under The "D" Word
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rffrydr · Posted: Wed Apr 08, 2009 5:33 pm Post subject:

Job, jobs and jobs setting up another hit say's the ever watchful S&P:

http://ftalphaville.ft.com/blog/2009/04/08/54596/sp-downgrades-the-whole-us-mortgage-insurance-sector/
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rffrydr · Posted: Sun Apr 05, 2009 7:21 am Post subject:

Mortgage workouts not working out. I'm baffled by this N. Korean-like intransigence on the part of the now taxpayer funded banks. The contract must be the thing.... so BK cramdowns lurking, satisfied???

http://www.latimes.com/business/la-fi-loanmods4-2009apr04,0,4466775.story
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rffrydr · Posted: Fri Apr 03, 2009 8:55 am Post subject:

Spent last couple weekends "enjoying" SoCal foreclosure Salebration auctions. The unfinancable crap was clearing at great values, middle-road stuff attracted healthy bidding, awkward unfinished projects were being called back and the sprinkling of poor homes in rich areas were met buy bidding frenzies only to be described as extraordinary.

American Banker did a piece on this. The "auction-touch" can def. add value--waiting there in grand hotel ballrooms, with the wife for hours and then suddenly the spotlight is on you. "Star Value."

Financiers and lawyers were lined up and really making a stretch with 4.6% rates.
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rffrydr · Posted: Wed Apr 01, 2009 7:42 am Post subject:

Straight from the horse's mouth:

http://media.bloomberg.com/bb/avfile/News/Surveillance/vGO5fbyN5aJ0.mp3

Bubble markets (exception of Vegas, of course) are finding buyers and clearing. Surprises in Boston. Shiller refuses to "use" his own index. Products coming to NYSE.
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