SEC Obtains Settlement With CEO to Recover Compensation and Stock Profits He Received During Company's Fraud
FOR IMMEDIATE RELEASE
2011-61

http://www.sec.gov/news/press/2011/2011-61.htm

Washington, D.C., March 3, 2011 – The Securities and Exchange Commission today announced a settlement with the chief executive officer of an Atlanta-based homebuilder to recover several million dollars in bonus compensation and stock profits that he received while the company was committing accounting fraud.

According to the SEC’s complaint filed today in federal court in Atlanta, CEO Ian J. McCarthy previously failed to reimburse Beazer Homes USA Inc. for bonuses, other incentive-based or equity-based compensation, and profits from Beazer stock sales that he received during the 12-month periods after his company filed fraudulent financial statements during fiscal year 2006.

The SEC brought previous enforcement actions against the company and its former chief accounting officer who perpetrated the fraud. While not personally charged for the misconduct, McCarthy is still required under Section 304 of the Sarbanes-Oxley Act to reimburse the issuer for incentive-based compensation and stock sale profits received during that fraudulent period. The settlement with McCarthy is subject to court approval.

“Today’s action makes clear that incentive compensation and stock sale profits for CEOs and CFOs is subject to a clawback if received while a company was deceiving its shareholders about financial results,” said Robert Khuzami, Director of the SEC’s Division of Enforcement. “This provides an important incentive for senior executives to be vigilant in preventing misconduct and ensuring that companies comply with financial reporting requirements.”

Rhea Kemble Dignam, Director of the SEC’s Atlanta Regional Office, added, “McCarthy was receiving millions of dollars in bonuses and other incentive compensation while Beazer was misleading investors and fraudulently overstating its income. Section 304 requires McCarthy to reimburse Beazer for that compensation and profits on the sale of Beazer stock.”

Without admitting or denying the SEC’s allegations, McCarthy agreed to reimburse Beazer $6,479,281 in cash, 40,103 restricted stock units (or its equivalent), and 78,763 shares of restricted stock (or its equivalent). This reimbursement represents McCarthy’s entire fiscal year 2006 incentive bonus ($5,706,949 in cash and 40,103 in restricted stock units), $772,232 in stock sale profits, and 78,763 shares of restricted stock granted in 2006.

Section 304 of the Sarbanes-Oxley Act requires reimbursement by certain senior corporate executives of any bonus or other incentive-based or equity-based compensation received during a period in which a company was in material non-compliance with financial reporting requirements due to misconduct, as well as profits from stock sales during that same period. This can include an individual who has not been personally charged with the underlying misconduct or alleged to have otherwise violated the federal securities laws.

According to the SEC’s complaint against McCarthy, Beazer was required to prepare accounting restatements for the fiscal year ended Sept. 30, 2006 and first three quarters of fiscal 2006 due to its fraudulent conduct, which consisted of a manipulation of Beazer’s land development and house cost-to-complete accounts as well as the improper recording of certain model home financing transactions as sales for the purpose of increasing Beazer’s income.

Beazer settled an SEC enforcement action in September 2008, and the SEC charged its former chief accounting officer Michael T. Rand in July 2009. The litigation against Rand is still ongoing.

# # #

For more information about this enforcement action, contact:

Rhea Kemble Dignam
Director, SEC Atlanta Regional Office
(404) 842-7610

William P. Hicks
Associate Director, Enforcement, SEC Atlanta Regional Office
(404) 842-7675



Link to the SEC Complaint against Ian J. McCarthy:

http://www.sec.gov/litigation/complaints/2011/comp-pr2011-61.pdf

Link to the SEC Enforcement Action from 2008 against Ian J. McCarthy:

http://www.sec.gov/litigation/admin/2008/33-8960.pdf

Link to SEC press release from 2009 for charges against chief accountant, Michael T. Rand

http://www.sec.gov/news/press/2009/2009-146.htm

Link to SEC litigation release against Michael T. Rand

http://www.sec.gov/litigation/litreleases/2009/lr21114.htm

Link to SEC complaint against Michael T. Rand

http://www.sec.gov/litigation/complaints/2009/comp21114.pdf

Why 2011 May Be the End of the Housing Crash . http://online.wsj.com/article/SB10001424052748703796504576168822497423738.html?mod=WSJ_hp_MIDDLENexttoWhatsNewsForth

I think we see a surprise when early spring hits...and then we'll see where this goes...but I think it's a double buy 4th of July. imho. Z

I agree. I'm thinking that April will be a hugh start to a major rally right into winter...then a pull back (normal) and then continue next year same time. imho Z

we need a good rally of back-to-back months/weeks reports...

"Still, investors took January's overall increase in home starts as a positive sign for an industry coming off the worst two years for home construction dating to 1959."
http://www.bloomberg.com/news/2011-02-16/homebuilder-stocks-rise-as-housing-starts-spike.html

we have a LOT of room to go. repeated positive reports is what beazer needs to head up to double-digits.

being long BZH is easy. by now I've learned to just accept that the price swings around a lot but the trend is going higher and it will follow the climb out of the bad economy. I really should establish a large short-term position because it's inevitable this will be pushing $5.50 in a week or two.

Yep. I see upside all the way through this year into next. Z

wow, talk about shrugging off a loss!! $5.20 pre-market had me worried but I sticked it out and am glad I kept and let it ride up $0.14 today.

06:09:29 Beazer Homes misses by $0.20, misses on revs

Today BRIEFING.COM


Reports Q1 (Dec) loss of $0.66 per share, $0.20 worse than the Thomson Reuters consensus of ($0.46); revenues fell 48.2% year/year to $110.3 mln vs the $164.3 mln consensus. Total home closings from continuing operations: 527 homes, a 43.6% decrease from the prior year. Co provides additional Q1 metrics. Total new orders from continuing operations: 540 homes, a 23.9% decrease from the prior year. Total Backlog: 800 homes with a sales value of $201.1 mln compared to 960 homes with a sales value of $232.3 mln as of December 31, 2009.

totally agree. Z

we looking at $9-10 a share easy in 2 years def. long buy

HUD Official: Govt Settlement With Beazer Too Lenient -CNBCFont size: A | A | A
7:21 AM ET 9/23/10 | Dow Jones
DOW JONES NEWSWIRES

The U.S. government was too lenient with a $53 million settlement with Beazer Homes USA Inc. (BZH) in 2009 over the builder's subprime lending practices, the Department of Housing and Urban Development's inspector general has asserted, CNBC reported Wednesday, citing documents it obtained.

HUD Inspector General Kenneth Donohue said the settlement, between Atlanta-based Beazer and the Justice Department, "provided too little restitution" to affected homeowners. Donohue has complained that U.S. Attorney General Eric Holder has not responded to a letter he sent in July regarding the matter. Donohue did not propose an alternative amount for a fine, the network said.

Representatives of Beazer and the DOJ did not respond to a request for comment.

A joint federal probe by the Federal Bureau of Investigation and HUD found that Beazer's mortgage lending unit had violated federal regulations by giving government-backed loans to buyers who couldn't afford them, the Wall Street Journal reported on Aug. 28.

11:43:53 Today MARKETWATCH.COM Builder stocks hit by higher August foreclosures


BOSTON (MarketWatch) -- Home-builder stocks fell Thursday after RealtyTrac
estimated foreclosure filings rose 4% in August from July. Shares of KB Home ,
Ryland Group Inc. , D.R. Horton Inc. and Toll Brothers Inc. were all down at
least 3%. Earlier in the week, Beazer Homes USA Inc. scaled back its outlook,
saying market conditions have deteriorated since the expiration of the home-buyer
tax credit.

Beazer Homes updates expectations for certain FY 2010 operating data


6:18 AM ET 9/15/10 | Briefing.com
Co announces updates to operating metrics. The Company previously has said that it expected new home orders for FY10 to be higher than FY09. Based on sales results through September 15th, the co now expects that new home orders will be between 700 and 800 homes for the fourth quarter of FY10, resulting in YoY new home orders that may be above or below FY09 results. This revised expectation reflects a slower-than-anticipated improvement.The co expects full year FY10 land and land development spending will be below $200 mln vs stated $200-220 mln. The co expects FY10 Gross Margins to be higher than comparable FY09 were 11.7%.

BZH excellent day. IF economy improves...goal is to break last high of 7.08. Z

20:09:31 BZH WSJ(8 26) Options Report: Bets On Beazer


(From THE WALL STREET JOURNAL)
By Brendan Conway

Options traders looked past a glum reading on home sales as they took bullish
positions on a number of home-builder stocks.

One of the companies in focus was Beazer Homes USA, whose shares have fallen
by nearly a half since May. Traders scooped up more than 4,000 $5 November call
options that make money if the stock gains at least 41% in the next three
months. Beazer's shares gained 17 cents, or 4.9%, to $3.64.

The same investors also appeared to sell a similar number of $2.50 November
Beazer puts in a bullish "risk reversal" trade. Selling puts allows traders to
collect a premium on the view that the stock is unlikely to fall below certain
levels, and is worth owning if it does.

Home-builder stocks were broadly higher Wednesday, shrugging off data showing
July new-home sales dropped to a record low. A surprise profit by Toll
Brothers helped.


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(END) Dow Jones Newswires

08-25-10 2009ET

Copyright (c) 2010 Dow Jones & Company, Inc.

20:09 082510

15:30:00 OPTIONS REPORT: Builder Bulls Charge Past Poor Housing Data


By Brendan Conway
Of DOW JONES NEWSWIRES


NEW YORK (Dow Jones)--Options traders looked past a glum reading on home
sales as they took bullish positions on a number of homebuilder stocks.

One of the companies in focus was Beazer Homes USA Inc., whose battered
shares have fallen by about half since May. Rebound-minded traders scooped up
more than 4,000 $5 November call options that make money if the stock gains at
least 41% in the next three months. Beazer's shares gained as much as 17 cents,
or 4.9%, to $3.64.

The same investors also appeared to sell a similar number of $2.50 November
Beazer puts in a bullish "risk reversal" trade. Selling puts allows traders to
collect a premium on the view that the stock is unlikely to fall below certain
levels, and is worth owning if it does.

Homebuilder stocks were broadly higher Wednesday, shrugging off data showing
new-home sales dropped to a record low in July. A surprise profit by luxury
homebuilder Toll Brothers Inc. helped. So did the feeling among investors that
bad data like Wednesday's can provide a good opportunity to buy.

D.R. Horton Inc. was another homebuilder of interest. Traders showed up for
September $11 calls on a day that shares in the builder gained 45 cents, or
4.5%, to $10.41. At a cost of 20 cents, the contracts make money if D.R.
Horton's stock adds at least 7.6% by the middle of next month.

Bullish-looking trades also crossed the tape in Lennar Corp. and the SPDR S&PHomebuilders exchange-traded fund, also called the XHB. As Lennar's stock rose
41 cents, or 3.1%, to $13.31, trading was notable in October $14 call options
that make money if the shares gain more than 11% in the next two months.

"Perhaps the message is to play a move higher in the stocks through buying
slightly out-of-the-money calls," Lillian Seidman-Davis, chief options
strategist at Miller Tabak & Co., said.

The one big exception Wednesday: Toll Brothers. Here, traders in the high-end
builders' options appeared to sell large batches of $17 call options. Traders
often sell calls when they don't expect a stock will rise appreciably higher.
For shareholders, selling calls can be an "overwrite" strategy that generates
income and sets up a potential exit from the stock.

The investors appeared to collect a premium of nearly 5% of the shares'
value. Later in the session, Toll Brothers' stock rose as much as $1.06, or
6.5%, to $17.25. That jump in the shares means the calls were "in the money"
after just a few hours, meaning sellers could be required to hand over shares.


-By Brendan Conway, Dow Jones Newswires; (212) 416-2670;
brendan.conway@dowjones.com


Click here to go to Dow Jones NewsPlus, a web front page of today's most
important business and market news, analysis and commentary:
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(END) Dow Jones Newswires

08-25-10 1530ET

Copyright (c) 2010 Dow Jones & Company, Inc.

15:30 082510

GL Z

Yea after I get out of this one I will not be back!!! I didn't want to get into it but greed took over and I got caught with my pants down. Just waiting it out now! Looks like it may work out though. Hope hope hope.

Sorry about your pink situation...I hardly play'm any more. Homebuilders are fun Should be heck of a lot of fun over the several months. imho. You might like SPF also. Z

I play a little bit of everything. I definately wouldn't consider myself a pink player I'm just stuck in a pink stock. I have been playing Beazer for a couple of years now. Easy 10's all day long. Same with STP and HOV. I like the builder stocks cause they bounce around so much.

I am ... just don't know why your here? Your a pink player. Z

Well I guess I understand now. Not a people person huh!

and your point? Z

Not a very active board huh!

JULY 15, 2010 - 8:02 AM ET Beazer Homes Raised To Buy From Neutral By UBS >BZH

09:37:07 Today BZH Beazer Homes Started At Neutral By Credit Suisse >BZH

14:47:52 BZH Beazer Homes Raised To Hold From Sell By S&P Equity >BZH

19:45:00 Today BZH Beazer Homes Announces Pricing of $447.6 Million Aggregate Offerings of Common Stock, Tangible Equity Units and Senior Unsecured Notes


Beazer Homes Announces Pricing of $447.6 Million Aggregate Offerings of Common
Stock, Tangible Equity Units and Senior Unsecured Notes

ATLANTA, May 04, 2010 (BUSINESS WIRE) -- Beazer Homes USA, Inc. (BZH)
(http://www.beazer.com) (the "Company") announced today that it priced its
previously announced offering of 12.5 million shares of its common stock at $5.81
per share, resulting in net proceeds of approximately $68.5 million. The Company
also priced its offering of 3.0 million 7.25% tangible equity units at $25.00
each, resulting in net proceeds of approximately $72.3 million. The Company's
9.125% senior unsecured notes due 2018 were priced at 100% of the $300.0 million
aggregate principal amount issued, resulting in net proceeds of approximately
$295.1 million. The Company has granted the underwriters in the common stock and
tangible equity units offerings a 30-day option to purchase up to an additional
1.875 million shares of common stock and 450,000 tangible equity units,
respectively, to cover over-allotments. The Company's common stock is listed on
the New York Stock Exchange under the symbol "BZH" and the Company has applied to
list the tangible equity units on the New York Stock Exchange.

The Company intends to use the net proceeds from these concurrent offerings to
fund (or replenish cash used to fund) debt repurchases, including the anticipated
redemption of the Company's 8 3/8% senior notes due 2012 and 4 5/8% convertible
senior notes due 2024, and for other general corporate purposes. As of April 30,
2010, $303.6 million aggregate principal amount of the 8 3/8% senior notes due
2012 and $154.5 million of aggregate principal amount of the 4 5/8% convertible
senior notes due 2024 were outstanding.

Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC served as
the joint book-running managers for the common stock offering, Deutsche Bank
Securities Inc. and UBS Securities LLC served as joint lead managers and Moelis &
Company LLC served as co-manager. Citigroup Global Markets Inc. and Credit Suisse
Securities (USA) LLC served as the joint book-running managers for the tangible
equity units offering, Deutsche Bank Securities Inc. served as joint lead manager
and Moelis & Company LLC served as co-manager. Credit Suisse Securities (USA) LLC
and Citigroup Global Markets Inc. served as the joint book-running managers for
the senior unsecured notes offering, Deutsche Bank Securities Inc. served as
joint lead manager and Moelis & Company LLC served as co-manager.

The shares of common stock, tangible equity units, including the underlying stock
purchase contracts and senior amortizing notes, and senior unsecured notes all
will be issued pursuant to an effective shelf registration statement previously
filed with the Securities and Exchange Commission on Form S-3. Preliminary
prospectus supplements related to the offerings have been filed with the
Securities and Exchange Commission and are available on the SEC's website,
http://www.sec.gov. Copies of the preliminary prospectus supplements and the
accompanying base prospectus related to the common stock, tangible equity units
and senior unsecured notes offerings may be obtained from: Citigroup Global
Markets Inc., Brooklyn Army Terminal, 140 58th Street, 8th Floor, Brooklyn, NY
11220 (Attention: Prospectus Department; Telephone: (800) 831-9146; E-mail:
batprospectusdept@citi.com) or Credit Suisse Securities (USA) LLC, Prospectus
Department, One Madison Avenue, New York, NY 10010 (Telephone: 800-221-1037).

This press release shall not constitute an offer to sell or the solicitation of
an offer to buy, nor shall there be any sale of these securities in any state or
jurisdiction in which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such state or
other jurisdiction.

Beazer Homes USA, Inc., headquartered in Atlanta, is one of the country's ten
largest single-family homebuilders with continuing operations in Arizona,
California, Delaware, Florida, Georgia, Indiana, Maryland, Nevada, New Jersey,
New Mexico, North Carolina, Pennsylvania, South Carolina, Tennessee, Texas, and
Virginia.

Forward Looking Statements

This press release contains forward-looking statements. These forward-looking
statements represent our expectations or beliefs concerning future events, and it
is possible that the results described in this press release will not be
achieved. These forward-looking statements are subject to risks, uncertainties
and other factors, many of which are outside of our control, that could cause
actual results to differ materially from the results discussed in the
forward-looking statements, including, among other things, changing market
conditions, the Company's ability to satisfy the conditions to closing the
offerings and the Company's ability to repurchase its outstanding notes from time
to time. For more information, see the Company's filings with the Securities and
Exchange Commission, including the preliminary prospectus supplements relating to
the proposed offerings.

Any forward-looking statement speaks only as of the date on which such statement
is made, and, except as required by law, we do not undertake any obligation to
update or revise any forward-looking statement, whether as a result of new
information, future events or otherwise. New factors emerge from time to time and
it is not possible for management to predict all such factors.

SOURCE: Beazer Homes USA, Inc.

Beazer Homes USA, Inc.
Jeff Hoza, 770-829-3700
Vice President, Treasurer
jhoza@beazer.com


Copyright Business Wire 2010

16:27:12 BZH Beazer Homes beats by $0.72, beats on revs; announces 12.5 mln share offering, announces $300 mln senior note offering


Reports Q2 (Mar) earnings of $0.10 per share, excluding non-recurring items, $0.72 better than the Thomson Reuters consensus of ($0.62); revenues rose 6.2% year/year to $198.2 mln vs the $191.4 mln consensus. New orders from continuing operations: 1,673 homes, an increase year-over-year of 48.8%. Cancellation rate improved to 17.6% in the second quarter compared to 26.9% in the first quarter of this year and 29.8% in the second quarter of the prior year. Gross profit margin of 13.1% (18.3% without impairments and abandonments), compared to -11.9% (11.1% without impairments and abandonments) in the second quarter of the prior year. Backlog: 1,781 homes with a sales value of $394.5 million compared to 1,278 homes with a sales value of $296.3 million as of March 31, 2009.

16:16:19 Today BZH Beazer Homes 1Q EPS 9c >BZH

WOW! go BZH... HOV bustin $8!

09:57:07 US March Building Permits Revised To +6.7% From +7.5%


DOW JONES NEWSWIRES

U.S. building permits for March were revised to up 6.7% from February to a
seasonally adjusted rate of 680,000, the Commerce Department reported Monday.

March building permits were originally reported as being up 7.5% at a
seasonally adjusted rate of 685,000.

Building permits are a precursor of building activity.

Click here to go to Dow Jones NewsPlus, a web front page of today's most
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(END) Dow Jones Newswires

04-26-10 0957ET

Copyright (c) 2010 Dow Jones & Company, Inc.

09:57 042610

$$$$$$$

13:16:00 BZH Fitch Affirms Beazer's IDR at 'CCC'; Outlook Stable


Fitch Affirms Beazer's IDR at 'CCC'; Outlook Stable

CHICAGO, Apr 20, 2010 (BUSINESS WIRE) -- Fitch Ratings has affirmed Beazer Homes
USA, Inc.'s (Beazer) ratings as follows:

--Issuer Default Rating (IDR) at 'CCC';

--Secured revolving credit facility at 'B+/RR1';

--Second lien secured notes at 'B+/RR1';

--Senior unsecured notes at 'CC/RR5';

--Convertible senior notes at 'CC/RR5';

--Convertible subordinated notes at 'C/RR6';

--Junior subordinated debt at '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 RRs.

The ratings and Outlook for Beazer reflect the company's healthy liquidity
position, moderately improved prospects for the housing sector this year, but
still substantial indebtedness. The company ended its 2010 first quarter (ended
Dec. 31, 2009) with unrestricted cash of $432.7 million. The company also
recently filed an application for a federal income tax refund of approximately
$101 million as a result of the tax legislation enacted in November 2009. In
January 2010, the company completed an equity offering of 22.4 million shares and
the issuance of $57.5 million of convertible senior notes. The company received
net proceeds of $153.8 million from the offerings, including the full exercise of
over-allotment option for each offering, after underwriting discounts and
commissions. Proceeds from these offerings were used to redeem $127.3 million of
senior notes due May 15, 2011. Following the redemption of these notes, Beazer
will not have any major debt maturities until April 2012, when $304 million of
senior notes become due. (Note: Holders of Beazer's $154.5 million convertible
senior notes have the right to require the company to purchase all or any portion
of this debt issue for cash on June 15, 2011.)

The company reported revenues of $218.8 million during the first quarter of 2010
(1Q'10), flat compared to the same period last year. Total deliveries increased
8% while the average sales price fell 8.8% during the quarter. Gross margins,
excluding impairment charges, improved 160 basis points to 12.9% during the first
quarter. SG&A expenses as a percentage of sales remain elevated at 20.9% during
the 1Q'10 but are lower than the 24.7% recorded last year. Beazer reported a
pre-tax loss of $49.5 million during the 1Q'10, which included $8.8 million of
inventory impairment charges. The pre-tax loss for the 1Q'09 was $81.1 million,
including $12.4 million of inventory impairment charges. Net orders for the
quarter increased 36.6% to 728 homes and the company had 960 homes in backlog
with a value of $232.3 million at the end of the first quarter. Cancellation
rates improved to 26.9% during the 1Q'10 from 46.1% last year and 34.7% during
the prior quarter.

Housing apparently bottomed during 2009, and a so far anemic recovery has begun.
During the next 12-15 months off the bottom, the recovery may appear jaw-toothed
as substantial foreclosures now in the pipeline present as distressed sales and
as meaningful new foreclosures arise from Alt-A and option ARM resets. High
unemployment rates and the tightening of certain Federal Housing Administration
loan standards will be notable headwinds early in the upcycle. The continuation
and expansion of the scope of the national housing credit may boost sales in
spring of this year. Also the Federal government's continuing efforts to modify
foreclosures may finally show some success in 2010.

Beazer generated cash flow from operations of negative $59.3 during the 1Q'10.
Cash flow from operations totaled $146.4 million for the latest 12 months from
Dec. 31, 2009. For all of fiscal 2010, Fitch expects Beazer to be cash flow
negative, excluding the expected second-quarter tax refund of $101 million, as
the company starts to rebuild its land position (through land purchases and
development spending).

Beazer amended its secured revolving credit facility in 2009, reducing the size
from $150 million to $22 million, and the facility is provided by one lender. The
amended facility will continue to provide for working capital and letter of
credit needs collateralized by either cash or assets of the company. Beazer also
entered into three stand-alone, cash-secured, letters of credit agreements with
banks to maintain pre-existing letters of credit that had been outstanding under
the $150 million revolver. Consistent with Fitch's comment on certain
homebuilders' termination of revolving credit facilities, in the absence of a
traditional revolving credit line, a consistently higher level of cash and
equivalents than was typical should be maintained on the balance sheet,
especially in these still uncertain times.

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 and especially free cash flow trends and uses, and the
company's cash position.

Applicable criteria available on Fitch's website at 'www.fitchratings.com':
(http://www.fitchratings.com%27:) 'Corporate Rating Methodology', dated Nov. 24,
2009.

Additional information is available at 'www.fitchratings.com'
(http://www.fitchratings.com%27).

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS.
PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK:
HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING
DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S
PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM' (http://WWW.FITCHRATINGS.COM%27). PUBLISHED
RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES.
FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE
FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO
AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE.

SOURCE: Fitch Ratings

Fitch Ratings
Robert Curran, +1-212-908-0515 (New York)
Robert Rulla, +1-312-606-2311 (Chicago)
Media Relations:
Sandro Scenga, +1-212-908-0278 (New York)
sandro.scenga@fitchratings.com


Copyright Business Wire 2010

Orange County CA home median up almost 10% from 12 months ago. Buiulders are building and SELLING. Irvine Company hadn't built a house in 20 years but todays headline says they have now started RES building again. Dips may come and go from here but soon this price will be visible only in the rear view mirror.

US DATA WEEK AHEAD: Tax Credit Seen As Lift To Home Sales


By Kathleen Madigan
Of DOW JONES NEWSWIRES


NEW YORK (Dow Jones)--The economic reports next week are back-loaded, giving
investors time early in the week to see how the SEC's fraud case against
Goldman Sachs plays out further in the financial markets.

A new data point for the labor markets will be reported Thursday when the
Labor Department releases weekly jobless claims. Next week's report will be of
particular interest because the new data will cover the survey week included in
the government's employment report for April.

The median forecast of economists surveyed by Dow Jones Newswires Friday
expect that jobless claims totaled 460,000 in the April 17 week, down from the
unexpectedly high reading of 484,000 in the prior week.

Also arriving Thursday will be the National Association of Realtors' report
on existing home sales. The median forecast is for resales increasing to an
annual rate of 5.25 million in March, up from 5.06 million in February. House
hunters are rushing to take advantage of the expanded tax credit, set to expire
at the end of April.

New home sales, scheduled for release Friday, are projected to have increased
6.5% to a 328,000 pace in March.

Another look at March inflation will come on Thursday with the release of the
producer price index. The total PPI is projected to rise 0.3% in March, while
the core index that excludes food and energy is expected to be up 0.1%.

DATE TIME RELEASE PERIOD CONSENSUS PREVIOUS
(ET)
Monday 1000 Leading Index Mar +1.1% +0.1%
Thursday 0830 Jobless Claims Apr 17 460K 484K
0830 Producer Price Index Mar +0.3% -0.6%
--ex food & energy +0.1% +0.1%
1000 Existing Home Sales Mar 5.25mln 5.06mln
--percent change +3.8% -0.6%
Friday 0830 Durable Goods Orders Mar +0.3% +0.9%
1000 New Home Sales Mar 328K 308K
--percent change +6.5% -2.2%


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kathleen.madigan@dowjones.com


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(END) Dow Jones Newswires

04-16-10 1534ET

Copyright (c) 2010 Dow Jones & Company, Inc.

15:34 041610

Not impressed! HOV still at 63 mil and looks like the huge short there is feeling it now too.

Today's 8K:

On April 13, 2010, Beazer Homes USA, Inc. (“Beazer” or the “Company”) filed with the Delaware Secretary of State a Certificate of Amendment (the “Certificate of Amendment”) to the Company’s Amended and Restated Certificate of Incorporation increasing the Company’s total authorized common stock from 80 million shares to 180 million shares. As described below under Item 5.07 of this Current Report, the Certificate of Amendment was approved by the stockholders at the 2010 Annual Meeting of Stockholders.

Big day Thursday 4/15: Economic Data and Reports:

8:30 AM - Jobless Claims
9:15 AM - Industrial Production
10:00 AM - Philadelphia Fed Survey
10:30 AM - EIA Natural Gas Report
1:00 PM - Housing Market Index
4:30 PM - Money Supply

BZH Sweeeeeeeet! More to come. Z

BZR is buzzing! WOW SPF now ahead at $5.99. ALERT: Builder HOV w/ 63 mil OS short position is at 35% per TDA. Was 43% last month at this time. Long way to go there if it does not settle down!

Doing well$$$

13:33:21 BZH S&P: Positive Outlook Acknowledges Potential For Another Upgrade Over Next 12 Mos If Beazer Maintains Adequate Liquidity In Face Of
Potentially Higher Working Cap, Other Cash Needs

13:27:45 Today BZH S&P Upgrades Beazer Homes USA To 'CCC+'; Outlook Positive

UPcoming Housing Data Reports:

Mar 23 10:00 AM Existing Home Sales Feb - 4.75M 5.00M 5.05M -
Mar 23 10:00 AM FHFA Home Price Index Jan - -1.2% -0.9% -1.6% -

Mar 24 10:00 AM New Home Sales Feb - 290K 315K 309K -

SPF me likie long time....avg 1.43. Z

Great day here for BZH! but low and behold look who just crept up and passed both BZH & HOV! SPF

Beazer Homes (NYSE:BZH): Cracks in Foundation But Property By No Means Condemned. Initiating Coverage With a Buy Rating - Citigroup
Citigroup's Homebuilding team is picking up coverage on Beazer Homes (NYSE:BZH) with a Buy rating and $6.25 target price, implying 37% upside.

Firm notes that according to Bloomberg, across the Street there are 5 Holds, 2 Sells and no Buy ratings. As such, they believe their investment thesis is an out of consensus call.

Based on valuation (BZH trades at ~0.8x Citi's estimate of 2Q10 TBV versus the peer group average of ~1.5x) and that fact that the rest of Street has seen fit to assign no Buy ratings to the stock, they think the investment community may not be distinguishing between BZH the company and BZH the stock. To be sure, BZH the company faces both operational and financial obstacles. That being said, the firm thinks the stock is cheap and that a positive near-term catalyst is likely to emerge in the form of a debt refinancing.

Company Overview
BZH is a top ten homebuilder based on closings. Like many of its peers, the company has shifted its focus to the first-time homebuyer segment (~65% of LTM closings). Through the downturn, BZH has exited many markets and as a result its operations are now concentrated in three regions: the West, East and Southwest. As of '08, BZH no longer operated a financial services subsidiary. BZH now utilizes a marketing arrangement with a third party financial institution to originate mortgages. BZH is headquartered in Atlanta. The company was founded in ‘85 and went public in ‘94.

Going With the Flow: Asset-Lite Strategy
BZH is pursuing an asset-lite strategy in which it attempts to minimize its land position and land development activities and focus instead on the building and selling of homes. Although BZH is targeting three to four years of total land exposure split evenly between owned and optioned land, it currently has one of the longer land supplies in its peer group.

Although asset-lite has become the predominant strategy among the public homebuilders, BZH has been less vocal than some of its peers about the importance of having an asset-lite strategy. Citi thinks BZH is deliberately trying not to over promise with regards to its ability to achieve its targeted land supply. While most of its peers which are acquiring new lots intend to monetize those purchases in the next 6-12 months, BZH's land acquisition strategy has somewhat of a longer dated focus. On its most recent conference call, BZH stated its land acquisition strategy is focused on “controlling positions that can generate home closings in ’11 and ’12.

Cracks in Foundation… — BZH faces both operational and financial challenges. On the homebuilding side, they think BZH is a below average operator. BZH's gross margins and inventory turns have trailed the peer group average while its SG&A as a percentage of revenues has recently exceeded the peer group average. On the financial side, even after factoring in the recent equity issuance and the company's tax refund, Citi thinks BZH's balance sheet remains highly leveraged with a ~61% net debt-to-cap compared to the peer group average of ~29%.

…But Property Not Condemned — Citi thinks investors are well served by distinguishing between BZH the company and BZH the stock. Their normalized earnings analysis suggests that for investors who are confident that BZH will survive, there is considerable upside in the stock relative to its current valuation. When calculating normalized earnings for BZH, they address the excess leverage issue by first "rightsizing" the company's balance sheet. Even after their "rightsizing" adjustment, they conclude that BZH is cheap.

Debt Refinancing Could Be a Positive Near-Term Catalyst — While their analysis suggests that BZH's near-term liquidity profile is adequate, they think an upcoming debt refinancing could be a positive catalyst for the stock. Next month the firm expects BZH to issue intermediate or long-term debt and use the proceeds to call its outstanding '12 debt. By removing the '12 maturity and terming out its debt structure, they think BZH would effectively eliminate any existential concerns.


Notablecalls: I must say that at least from the trading perspective, I like the call. What's there not to like:

- Sub-$10 stock with a relatively large price target and the only Buy rating on the Street.

- A beaten down stock that has managed to trap a lot of shorts. Short interest stands close to 20%.

- Catalyst ahead in form of an upcoming debt refinancing.

The problem with BZH is that they bought too much land at the wrong price. That means their margins will lag the peer group for years as it takes time to work off the expensive land inventory. But I guess with the stock down from the $80's (in 2006) to current $4-5 level, much of that is already priced in.

All in all, I expect BZH stock to trade up today to the tune of 5-7%, putting $4.75-4.85+ levels in play. It could go somewhat higher if the market continues its recent ramp. But I prefer to stay conservative as always.

posted by notablecalls # 7:26 AM 0 comments

aH NEWS!! Today's News, March 10, 2010
6:00p Beazer Homes Announces Closing of its Offer to Exchange $250 Million of its 12% Senior Secured Notes due 2017(Business Wire)

Bollies really tight at this time, somethings coming! Meanwhile keep an eye on HOV.