Housing
Did Homebuilders Finally Bottom? (DHI, TOL, LEN, CTX, HOV, BZH, XHB)
Published:
Last Updated:
If you have been watching homebuilders of late, you’ll notice a sharp disconnect between the headlines still coming out and the stock prices of many homebuilders. The move today is partly attributed to Sam Zell’s interview on CNBC saying this spring should mark the bottom in housing. The SPDR S&P Homebuilders (AMEX: XHB) ETF shares are up 6.3% at $22.56 today, and its 52-week low is $15.22.
Keep in mind that Zell has that Gafisa SA (NYSE: GFA) as one of his big plays in Brazil, which we recently noted as one of Jim Cramer’s top picks in Brazil. We have also noted how many of these stocks had doubled from lows. Banc of America recently was the first to upgrade several of these in the homebuilder sector as well.
Today, shares of these are up big, which you can see in comparison to their 52-week lows:
Stock/Symbol Trade Change 52-wk Range Market Cap
DR Horton (DHI) $16.44 +6.06% $9.78-27.26 $5.18B
Toll Bros (TOL) $23.24 +6.02% $15.49-32.00 $3.68B
Lennar (LEN) $20.40 +8.63% $11.98-51.43 $3.26B
Centex (CTX) $26.10 +9.53% $17.77-49.85 $3.19B
Hovnanian (HOV) $10.91 +10.20% $4.25-33.32 $679.76M
Beazer (BZH) $8.74 +12.48% $4.53-42.42 $342.68M
We have noted over and over that this sector would bottom and start to recover long before the news starts to look like anything resembling good news. That may or may not be now, but when you see an ETF recover 50% from lows you have to wonder how much worse things would have to get for that recovery to not at least partially hold up. At one point, things were getting so bad we even asked "which would hit zero first?"
We still expect more bad headlines with no end in clear site. But a 50% recovery in an ETF that measures a sector has to be telling you something, even if there will be more bad days on and off and even as more headlines still look bad.
Jon C. Ogg
February 26, 2008
Is Your Money Earning the Best Possible Rate? (Sponsor)
Let’s face it: If your money is just sitting in a checking account, you’re losing value every single day. With most checking accounts offering little to no interest, the cash you worked so hard to save is gradually being eroded by inflation.
However, by moving that money into a high-yield savings account, you can put your cash to work, growing steadily with little to no effort on your part. In just a few clicks, you can set up a high-yield savings account and start earning interest immediately.
There are plenty of reputable banks and online platforms that offer competitive rates, and many of them come with zero fees and no minimum balance requirements. Click here to see if you’re earning the best possible rate on your money!
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
