Beazer Homes Inc. (BZH)

[Wildbilly]

I just now saw on CNBC that
Jamie Dimond strongly disagrees with my assessment.
Expect a bounce, for the short term anyway, lol.

Good luck to you sir.

[RBKissMyAs]

Just relating my experience with these deals. I've rarely seen it as a plus. The "as usual" comment means that the hedge funds are generally ahead of 99% of retail investors. Not directed personally. The reason why these billionaires have swooped in buying these properties is we have two elements pointing to a revival of Real Estate....historically, extremely low interest rates and relatively low housing prices. Back in the early 90's after Bush II, we had tons of foreclosures but high rates. Not the magic formula, but now it's a prime situation to BUY. The big boys have snatched up all the cheap RE they can find. They'll be selling these properties to Joe Sixpack for a very tidy profit. I've done very well with Beazer, but the price is too high now for "bang for your buck" trading. For me anyway. My best RE buy though is NCT. Bought at 5. It's been as high as 8 recently and pays a 22 cent dividend! GLTA.

[Wildbilly]

Look, I simply made that comment
about R/S's because I'm a screw around jerk having a little fun my style.
I had just bought AVI before a R/S for $3.85 or something and sold it for $4.04 and bragged about it.

Oh wait, it's SRPT now. How awesome and knowledgeable am I, huh?

[Wildbilly]

The hedge funds a are way ahead of you...as usual.
lol, was that directed at me? Have I met you before or something?
ok, j/k.

I've been thinking for awhile now, that buying distressed properties might be a way to go, been looking hard at Florida for some time.
Many others have as well, but does that equate to the market?

It's a seasonal market, as Schiller said, rally's fizzle. The IMF has said there is a major slowdown in the world.

I enjoy the discussion cousin and think it's healthy for both of us.

[RBKissMyAs]

Yup, they suck almost every time. I've been in R/S before where it opens up and the retail investors were blocked from trading for the first hour while the insiders tanked the stock.

[RBKissMyAs]

http://www.businessinsider.com/the-1-percent-is-buying-up-all-the-real-estate-beware-of-tom-lee-of-jpm-2012-5

yes, rates are low. They do want you to buy. It's called stimulus. The hedge funds a are way ahead of you...as usual. Remember, stocks climb a wall of worry.

[Edmond]

Same here. I was planning on selling before the split but now I'm stuck. I truely hate reverse splits.

[Wildbilly]

So you weren't in already?
Did you happen to see the Santelli interview with Schiller a minute ago on CNBC? Wow, that's one of the best pieces I've ever seen.

A very digested version (my interpretation):

Low interest rates now. That tells me the government wants us to buy, right? Agree or disagree?

I'll just say, that makes me very wary.

(Where do you get your info from the previous post that all the big money is all in? Just curious.)

[RBKissMyAs]

BZH is out of my range after this. I don't buy stocks over 10 bucks.

[RBKissMyAs]

'don't buy into a housing run." That's about the worst advice I've seen in decades at this point. The deep pockets have loaded up on real estate to the hilt in the last year.

[Wildbilly]

Expect news if they know what
they're doing or have a cogent plan.
If not, head for the freaking hills bro'!

[Wildbilly]

edit: wrong redirect.

[Wildbilly]

sludgehound Member Profile sludgehound Thursday, October 11, 2012 11:44:43 PM
Re: None Post # of 10965
BZH Beazer 10/11 4:45pm R/S 1-5 at open

Closed $ 3.53 -0.06 (-1.67%) @123M O/S pre. Lot short interest so may catch some short for a pop. LT don't know. Personally I
don't buy into a housing run. Lot analysts deep into recent move are saving it's over when look closely.

http://ih.advfn.com/p.php?pid=nmona&article=54487782

Beazer Homes USA, Inc. (NYSE: BZH) announced today the effectiveness of a 1-for-5 reverse split of its common stock. Shares of Beazer Homes common stock will begin trading on a split-adjusted basis on the New York Stock Exchange under the Company’s existing symbol “BZH” upon the opening of the NYSE on October 12, 2012.

Beazer Homes’ stockholders approved the reverse stock split at a special meeting of stockholders held today. As a result, every five shares of Beazer Homes common stock outstanding have been combined into one share of common stock, reducing the number of shares of Beazer Homes common stock outstanding from approximately 123 million to approximately 24.6 million. In addition, the number of authorized shares will be reduced from 180 million shares to 100 million shares.

After discussion with several institutional stockholders, the Company’s Board of Directors has determined that it will propose and recommend at its upcoming 2013 annual meeting a further decrease in the number of shares of common stock authorized for issuance from 100 million to 63 million.

No fractional shares will be issued in connection with the reverse stock split. Instead, Beazer Homes’ transfer agent will aggregate all fractional shares that otherwise would have been issued as a result of the reverse stock split and those shares will be sold into the market. Stockholders who would have held a fractional share of Beazer Homes common stock will receive a cash payment from the net proceeds of that sale in lieu of such fractional share.

Upon the opening of the NYSE on October 12, 2012, shares of Beazer Homes common stock will trade under a new CUSIP number (07556Q 881) and a new ISIN (US07556Q8814).

Additional information regarding the reverse stock split, including the treatment of fractional shares and exchange of stock certificates, can be found in the Company’s definitive proxy statement filed with the Securities and Exchange Commission on September 7, 2012, copies of which are available at www.sec.gov.

#msg-80450899

[RBKissMyAs]

That answers why it traded so strangely today.

[eastunder]

Beazer Homes USA, Inc. Announces 1-for-5 Reverse Stock Split; Will Begin Split-Adjusted Trading on NYSE Tomorrow

http://ih.advfn.com/p.php?pid=nmona&article=54487782

Beazer Homes USA, Inc. (NYSE: BZH) announced today the effectiveness of a 1-for-5 reverse split of its common stock. Shares of Beazer Homes common stock will begin trading on a split-adjusted basis on the New York Stock Exchange under the Company’s existing symbol “BZH” upon the opening of the NYSE on October 12, 2012.

Beazer Homes’ stockholders approved the reverse stock split at a special meeting of stockholders held today. As a result, every five shares of Beazer Homes common stock outstanding have been combined into one share of common stock, reducing the number of shares of Beazer Homes common stock outstanding from approximately 123 million to approximately 24.6 million. In addition, the number of authorized shares will be reduced from 180 million shares to 100 million shares.

After discussion with several institutional stockholders, the Company’s Board of Directors has determined that it will propose and recommend at its upcoming 2013 annual meeting a further decrease in the number of shares of common stock authorized for issuance from 100 million to 63 million.

No fractional shares will be issued in connection with the reverse stock split. Instead, Beazer Homes’ transfer agent will aggregate all fractional shares that otherwise would have been issued as a result of the reverse stock split and those shares will be sold into the market. Stockholders who would have held a fractional share of Beazer Homes common stock will receive a cash payment from the net proceeds of that sale in lieu of such fractional share.

Upon the opening of the NYSE on October 12, 2012, shares of Beazer Homes common stock will trade under a new CUSIP number (07556Q 881) and a new ISIN (US07556Q8814).

Additional information regarding the reverse stock split, including the treatment of fractional shares and exchange of stock certificates, can be found in the Company’s definitive proxy statement filed with the Securities and Exchange Commission on September 7, 2012, copies of which are available at www.sec.gov.

[gixxer11]

Yep

[Edmond]

At what point is a good place to buy in?

[RBKissMyAs]

This thing has gone bonkers!

[Edmond]

I've been through 6 reverse splits and none came out ahead.

[Wildbilly]

In a lot of cases a r/s can be

bad news, especially in the micro-caps. I've deliberately

bought stocks before a r/s and done quite well a couple of times.

Unfortunately there is no reliable formula, it's a gut thing,

many times a company will do this and release serious material

event news. With an os of 123m and reversing it to 41m you can

see what the result would be in that scenario.

I think I'll vote 'for' with my 2 shares just to see where the

company is going with this.

Best of luck!

[Edmond]

If they vote in favor of the reverse split, the result is going to be more like a hang over rather than any over hang. My three votes are against it.

[Wildbilly]

Overhang of a possible r/s? Doing better today.

[Edmond]

Forcasters said they were expecting the home builders stock to continue on the upswing. Why did BZH get left out?

[eastunder]

LOLOL. Okay. Thanks anyway. Have a good weekend!!!!!

[RBKissMyAs]

Hell, I don't know. Too convoluted for me. I do think that overall, all real estate related investments will rise.

[eastunder]

Of course, and I understand that. I would be ashamed of myself if I didn't, especially after being in the market for sooooo many years. LOL

It's this I am curious about...

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=79566059

What are your thoughts on this?

[RBKissMyAs]

Well, technically it means nothing. The the price changes equal to the change in number of shares.

[eastunder]

That's my problem. I no longer think the purpose of the RS has anything to do with the price of the stock.

What if the actual purpose is to increase the shares available for issuance?

Is there another way to do that without a RS?


From the same filing....

http://www.sec.gov/Archives/edgar/data/915840/000119312512384933/d400340ddef14a.htm

Reasons for the Decrease in Authorized Shares

At present, we do not have any plans or arrangements to issue additional shares of common stock other than shares currently reserved for issuance under our existing equity incentive plans and upon conversion of our outstanding convertible notes and settlement of our outstanding tangible equity units. Nonetheless, the Board of Directors believes the Reverse Stock Split warranted reconsideration of the total number of shares authorized for future issuance under our Certificate of Incorporation.

As a matter of Delaware law, implementation of the Reverse Stock Split does not require a change in the total number of shares of our common stock authorized under our Certificate of Incorporation. Despite this fact, the Board of Directors carefully considered whether such a change was in the best interests of stockholders. In determining whether to recommend a change to the total number of shares of our common stock authorized under our Certificate of Incorporation, the Board of Directors considered a number of factors including: (i) the number of shares that would be available if we did not reduce our total authorized shares from the current limit of 180 million shares; (ii) the number of shares that would be available if our authorized shares were reduced in the same ratio as the Reverse Stock Split; (iii) the potential for future stock issuances to raise capital, effect acquisitions and/or provide equity incentives to employees; (iv) the proportion of authorized shares remaining available for issuance among our homebuilding peer group; and (v) the impact of potential future stock issuances on our deferred tax assets (as more fully described below).

After weighing these factors, the Board of Directors concluded that the Company’s authorized shares should be reduced from 180 million to 100 million. This level of authorized shares would leave the Company with approximately 66.4 million shares available for issuance after the Reverse Stock Split, or 66% of total authorized shares. The Board believes that this reduction strikes the right balance between having an unnecessarily large number of shares available for issuance, and having too few shares available for issuance, particularly in light of the substantial number of authorized shares available to our homebuilding peers.



• If the Reverse Stock Split were completed in the absence of a reduction in authorized shares, our total shares issued and outstanding, or reserved for issuance, would be approximately 33.6 million, leaving approximately 146.4 million shares, or 81.4% of our authorized total shares available for future issuance.




• At September 4, 2012, we had approximately 123.1 million shares issued and outstanding. In addition, we had approximately 2.2 million shares reserved for issuance under our existing equity incentive plans, which were previously approved by stockholders, and approximately 42.5 million shares reserved for issuance upon conversion of our outstanding convertible notes and settlement of our outstanding tangible equity units. Taken together, we had approximately 167.8 million shares issued and outstanding or reserved for issuance as of September 4, 2012, which means the Company currently has approximately 12.2 million shares, or 6.8% of our authorized total shares available for future issuance. If our total authorized shares were reduced in the same ratio as the Reverse Stock Split, we would have only approximately 2.4 million, or 6.8%, available for future issuance.




• While the Company and the Board of Directors are cognizant of stockholder concerns regarding ownership dilution that would result from future equity issuances, we believe that it is advisable to retain a competitive level of flexibility for future stock issuances as conditions in the housing market strengthen. Future opportunities may arise in which a share issuance is in stockholders’ best interests, including raising additional capital for land acquisitions, expanding through acquisitions or providing incentives to our employees consistent with peer practices, among other alternatives.




• Based on our analysis of available information for publicly traded homebuilders, we believe approximately 60% of their respective total authorized shares remain available for issuance by our publicly traded homebuilding peers on average. This ratio increases to approximately 70% of remaining authorized shares on average when considering only those public homebuilders which, like us, have a market capitalization of less than $2 billion.




• In recent years, we have generated significant net operating losses and unrealized tax losses (collectively, “NOLs”), which have given rise to our total deferred tax assets of $495.7 million, net of certain deferred tax liabilities as of June 30, 2012. Until we generate taxable income, these NOLs are likely to become larger. As long as a future “ownership change” does not occur, which under Section 382 of the Internal Revenue Code is determined in part by taking into account share issuances, we expect to be able to utilize a majority of our deferred tax assets upon achievement of sustained profitability. Because we cannot predict when or to what extent we will return to profitability , we carefully monitor — and will continue to carefully monitor — potential Section 382 ownership shifts, including limiting future share issuances that could limit or eliminate our ability to utilize these tax assets in future years.

[Edmond]

As long as the price goes up and construction continues to strengthen, there is no need for a RS. The actual goal should be to make it to 5.00 to open it up to institutional investers.

[eastunder]

Anyone feel like bantering back and forth on the RS?

I have some thoughts that I am trying to work my way around and some outside opinions might help?

You guys Interested in picking it apart?

Jen

[RBKissMyAs]

The market will back track. Meantime my IRA accounts are very happy!

[Edmond]

I also have some in another account but it sure looks like we picked the wrong time to take profits.

[RBKissMyAs]

I only sold trading shares. Still have core positions in other accounts. You're right though, you never know but then nobody ever went broke taking a profit.

[eastunder]

3.48 was the old high

[flicker]

Breakout?

[Edmond]

Guess I sold a little too early. One never knows when is a good time to take profits.

[eastunder]

I'm sorry. I guess I'm not making myself clear. LOL

I am against the reverse split and I think the whole thing is fishy. I don't like it one bit.

[Edmond]

That's obvious but it still won't make the company worth any more, or increase sales.

[eastunder]

There's more to that story. It's not just a reverse, it's also
The decrease of the authorized number of shares of the common stock from 180 million to 100 million.

The reasons behind the RS are not valid to me.

It's about the authorized, IMHO.

[Edmond]

Beware of the R/S. Raising the price per share will not increase sales. It 's my guess it will only drive potential buyers away to invest in other builders with better balance sheets. I'm in favor of working your way up, not buying it. I vote no on the R/S.

[RBKissMyAs]

I have not received the materials.

[eastunder]

Have you voted yet?

[eastunder]

Special Meeting of Stockholders October 11, 2012

Notice is hereby given that a special meeting of stockholders of Beazer Homes USA, Inc. will be held at 10:00 a.m. Eastern Time on Thursday, October 11, 2012 at our principal executive office at 1000 Abernathy Road, Suite 260, Atlanta, Georgia 30328. At this meeting, stockholders will vote on an amendment to our Amended and Restated Certificate of Incorporation to (i) effect a 1-for-5 reverse stock split of our common stock and, if and when the reverse split is effected, (ii) decrease the authorized number of shares of our common stock from 180 million to 100 million.

http://www.sec.gov/Archives/edgar/data/915840/000119312512384933/d400340ddef14a.htm

[RBKissMyAs]

I've an order in at 3 for trading shares in case we take a hit.

[eastunder]

Finviz Daily, Weekly, and Monthly charts

[RBKissMyAs]

2 things: It just filled the overhead gap @3.30 and there is a H&S formation. Doesn't mean it won't continue up but it might take a break.

[eastunder]

Really?

Can you annotate a chart and show me what you are looking at?

[RBKissMyAs]

I took some profits today. Looks like a H&S formation. Holding a core position.

[eastunder]

Fitch Upgrades Beazer's IDR to 'B-'; Outlook Stable

(extended version - link back to original post which is shorter. I like this one - East)

Fitch Upgrades Beazer's IDR to 'B-'; Outlook Stable

CHICAGO--(BUSINESS WIRE)-- Fitch Ratings has upgraded the Issuer Default Rating (IDR) of Beazer Homes USA, Inc. (NYSE: BZH) to 'B-' from 'CCC'. The Rating Outlook is Stable.

A full list of rating actions follows at the end of this press release.

The upgrade and the Stable Outlook reflect Beazer's operating performance so far this year, its robust cash position, and moderately better prospects for the housing sector during the remainder of this year and in 2013. The rating is also supported by the company's execution of its business model, land policies, and geographic diversity.

Risk factors include the cyclical nature of the homebuilding industry, the company's high debt load and high leverage, BZH's underperformance relative to its peers in certain operational and financial categories, and its current over-exposure to the credit-challenged entry level market (approximately 60% of BZH's customers are first-time home buyers).

BZH's homebuilding revenues for the third quarter year-to-date (YTD) period increased 57.6% to $628.5 million as home deliveries grew 50.6% to 2,820 homes and the average selling price improved 4.6% to $222,900. The company has also reported improved quarterly net sales in each of the last five quarters, contributing to a 31% increase in homes in backlog at June 30, 2012 compared with year ago levels. The significant increase in backlog, combined with the company's strategy to grow community count, should result in moderately higher deliveries in fiscal 2013 compared with 2012. Nevertheless, Fitch does not expect BZH to be profitable in fiscal 2013.

The company has taken steps to further strengthen its balance sheet and improve its liquidity position to better participate in the housing recovery. In July 2012, BZH completed underwritten public offerings of its common stock, tangible equity units and a private placement of $300 million of 6.625% senior secured notes. Net proceeds from these transactions were roughly $466 million. Concurrently with the debt offering, BZH called for redemption of all of its $250 million 12% senior secured notes due 2017 and repaid $20 million under its outstanding cash secured term loan. These transactions are projected to lower annual interest expense by approximately $15 million.

After giving effect to the debt and equity offerings, the company had unrestricted cash of $417.6 million on a pro forma basis as of June 30, 2012. BZH has also negotiated a commitment letter with four financial institutions for a proposed $150 million three-year secured revolving credit agreement, which would replace the company's existing $22 million revolving credit facility. This credit agreement is expected to close during the September quarter.

The improved liquidity position provides BZH with some cushion as Fitch expects the company will continue to have operating losses and negative cash flow through fiscal 2013. Fitch currently expects BZH to end fiscal 2012 with unrestricted cash of between $400 million and $450 million. With higher land and development spending expected next year, unrestricted cash could fall below $250 million by the end of fiscal 2013.

BZH increased land and development expenditures in 2011 following four years of reduced spending. The company spent approximately $221.6 million on land and development during fiscal 2011 compared with $182.7 million expended in fiscal 2010. Through the first nine months of fiscal 2012 (ending June 30, 2012), BZH spent roughly $140.6 million on land and land development compared with $177.9 million spent during the first nine months of fiscal 2011. The company expects land and development spending for all of 2012 to be similar to 2011 levels. Given the improvement in the overall housing market, BZH expects to more aggressively pursue growth in new communities going forward. Fitch is comfortable with this strategy given the company's enhanced liquidity position and the fact that BZH has no major debt maturities until 2015, when $172.5 million of senior notes become due. Furthermore, management has demonstrated in the past that it is capable of pulling back on land and development spending when necessary.

At June 30, 2012, the company controlled 25,088 lots, of which 84.2% were owned and the remaining lots controlled through options. Based on the latest 12-month closings, BZH controlled six years of land and owned roughly five years of land. The company's owned-lot position includes 4,207 finished lots (or 19.9% of total owned lots), giving the company some discretion and flexibility in controlling its land and development spending.

Builder and investor enthusiasm have for the most part surged so far in 2012. However, national housing metrics have not entirely kept pace. Year-over-year comparisons have been solidly positive on a consistent basis. Yet, month to month the national statistics (single-family starts, new home, and existing home sales) have been erratic and, at times, below expectations. In any case, year to date these housing metrics are well above 2011 levels. As Fitch has noted in the past, recovery will likely occur in fits and starts.

Fitch's housing forecasts for 2012 have been raised since early spring, but still assume only a moderate rise off a very low bottom. In a slowly growing economy with relatively similar distressed home sales competition, less competitive rental cost alternatives, and new home inventories at historically low levels, single-family housing starts should improve about 12%, while new home sales increase approximately 10.5% and existing home sales grow 5.6%. Further moderate improvement is forecast for 2013.

Future ratings and Outlooks will be influenced by broad housing market trends as well as company specific activity, such as trends in land and development spending, general inventory levels, speculative inventory activity (including the impact of high cancellation rates on such activity), gross and net new order activity, debt levels, especially free cash flow trends and uses, and the company's cash position.

Beazer's ratings are constrained in the intermediate term due to weak credit metrics and high leverage. However, positive rating actions may be considered if the recovery in housing is maintained and is meaningfully better than Fitch's current outlook, BZH shows continuous improvement in credit metrics, and preserves a healthy liquidity position.

Negative rating actions could occur if the anticipated recovery in housing does not materialize and the company prematurely steps up its land and development spending, leading to consistent and significant negative quarterly cash flow from operations and diminished liquidity position. In particular, Fitch will review the company's ratings if the company's liquidity position (unrestricted cash plus revolver availability) falls below $200 million.

Fitch has upgraded the following ratings for BZH:

-- Long-term IDR to 'B-' from 'CCC';

-- Secured revolver to 'BB-/RR1' from 'B+/RR1';

-- Second lien secured notes to 'BB-/RR1' from 'B+/RR1';

-- Senior unsecured notes to 'CCC+/RR5' from 'CCC/RR4';

-- Convertible subordinated notes to 'CCC/RR6' from 'C/RR6';

-- Junior subordinated debt to 'CCC/RR6' from 'C/RR6'.

The Rating Outlook is Stable

The Recovery Rating (RR) of 'RR1' on Beazer's secured credit revolving credit facility and second-lien secured notes indicates outstanding recovery prospects for holders of these debt issues. The 'RR5' on Beazer's senior unsecured notes indicates below-average recovery prospects for holders of these debt issues. Beazer's exposure to claims made pursuant to performance bonds and joint venture debt and the possibility that part of these contingent liabilities would have a claim against the company's assets were considered in determining the recovery for the unsecured debtholders. The 'RR6' on the company's mandatory convertible subordinated notes and junior subordinated notes indicates poor recovery prospects for holders of these debt issues in a default scenario. Fitch applied a liquidation value analysis for these recovery ratings.

[eastunder]

Maybe that's because they think it won't happen?