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LSEA Nice run since earnings. Does anyone know the terms of those warrants LSEAW?
BGFV sure looks cheap in the 15s but it is hard to pull the trigger when everything keeps dropping everyday. Also, there remains a very high short interest of 33% which is much higher than in meme stocks lik GME nd AMC. Could bring an explosive rally someday. Question is: when?
F Ford's CEO also commented last Friday that they are considering making their EV production a separate stand alone company. I'm sure they hope to capture some of the rich valuations given to other EV companies. This would benefit F as they would keep a substantial holding in the new company's shares.
Hyundai and Kia warned that engines in almost 500,000 of their cars may spontaneously catch fire. The issue lies in an electrical component in their anti-lock brake systems that could short circuit. In the meantime, both automakers advised owners to park outdoors and away from buildings.
CCS I should definitely have trimmed my position AH yesterday at 72 range knowing that ugly FB report would likely also turn the market an ugly red today. Oh well.
CCS Just reported a blockbuster report. Up 6% AH. Lets se if it holds tomorrow. Century Communities (NYSE:CCS) reported quarterly earnings of $4.78 per share which beat the analyst consensus estimate of $4.07 by 17.44 percent. This is a 73.82 percent increase over earnings of $2.75 per share from the same period last year. The company reported quarterly sales of $1.20 billion which beat the analyst consensus estimate of $1.18 billion by 1.69 percent. This is a 21.48 percent increase over sales of $987.78 million the same period last year.
bbotc, check out MDC They pay a 4.3% dividend. I like them.
bbotc, No doubt that is what is holding them down. But when quality builders like MHO are now trading at a trailing PE of 4 and a fPE of closer to 3, and below book value, it makes it worth it to me to swim against the current. Builders are in an inverse bubble here, imo.
Also, the spread between the 2 yr and 10 yr trasury has steadily dropped from 1.5 to .6 in the last 7 months. I really doubt we will see 6% mortgages coming with that trend.
MHO DHI These two homebuilders reported strong results and nice beats:
M/I Homes Q4 EPS $3.83 Beats $3.38 Estimate, Sales $1.05B Beat $982.05M Estimate. Record backlog in both units and sales. Book value up to $57.
Stock is flat at $53 after opening up.
DHI (largest US homebuilder) EPS improved to $3.17 from $2.14 in 1Q21, beating the consensus of $2.79.
Consolidated pre-tax profit margin improved 380 bps to 21.2%.
C0mpany also raised guidance for 2022 above analyst estimates. Similar story here- after being up 4% in premarket, stock is now flat.
Investors are avoiding the group on fears interest rate hikes will soon lead to a bust cycle despite the builders reporting they cannot keep up with demand and are limiting sales and raising prices and that they don't see even a 1.5% increase in mortgage rates hurting their markets. There is an estimated shortage of about 5 million homes caused by underbuilding for over a decade and peoples shift to more working from home.
BZH Sure did not expect it to be down after that strong report. Read the CC transcript too, I think they are being very conservative on their guidance. They say they will earn more than $5, they will hit that with just 5% above their current backlog and specs which are all under construction. They build starter homes which shouldn't take more than 6 months to build even with the supply issues. I think they will earn $6 plus this year which gives them a PE of under 3!
They did say that their southeast region was the slowest. Not because of lack of demand but because of delays in getting permits issued by skeleton staffed building departments. Could be a forewarning for those builders concentrated in the SE USA.
Yes the sector has started out this year in a nasty bear market. It is based more on fears rather than facts. Builders cannot keep up with demand and continue to raise prices.
BZH This homebuilder reported after the closewith a big beat in eps.
Beazer Homes press release (NYSE:BZH): Q1 GAAP EPS of $1.14 beats by $0.47.
Revenue of $454.1M (+6.0% Y/Y) beats by $2.2M.
Shares +4.4%.
Orders were down but I suspect that is because they are metering sales. New guidance says they will beat $5 eps this year which means a PE of under 3.6! Stock up about 2% AH.
Then there's an old adage for the stock market:
As goes January, so goes the year.
(Fortunately it hasn't been as accurate in recent years)
Home builders: UBS analyst also came out with a bullish report on the homebuilders. I also exchanged a few emails with John Lovallo when he was at Merrill. Bullish reports don't seem to get the press that negative ones do though, lol. His favorites include KBH, DHI, MTH, and LEN. He didn't cover the smaller cousins at Merrill like CCS and MHO which I think are great buys here.
https://seekingalpha.com/news/3789708-homebuilders-building-products-poised-for-more-growth-ubs-analyst-says
IVR has been a mistake, so far anyway. Of course, I did not expect the market to tank 5% last week either. Thanks for the link too, although I suspect mreits were hit harder in both 2008 and 2020 than equity reits were. Absent those two extra-ordinary years, I wonder how they compare.
No doubt the homebuilders face some headwinds this year: increasing mortgage rates, supply chain shortages and labor shortages. But they are already down at single digit PEs, both trailing and forward. Some are only at low single digit PEs. Those same supply chain shortages will also prevent them from overbuilding and so I don't see a boom bust scenario unfolding this year either. I expect demand to remain strong this year, their biggest challenge will remain getting their homes built. I also expect we will see some more blow out earnings reports in the group over the next 15-30 days as KBH reported last week.
Just once, I would like to see an analyst downgrade come the day before rather than the day after big drops in stocks' prices.
IVR Joined skillz on this mREIT. Besides a very high yield that is covered and a discount to BV now, I also like:
This one should be a beneficiary of rising yields and spreads with the Fed tightening. This traded at $18 before covid hit and yields plunged. As we return to an era of more normal yields, IVR could see higher cash flows and dividends. They also have lots of cash on hand as of the last report and they are ready to invest it as opportunities occur.
Lots of liquidity too, trading about 5 million shares/day avg.
PSTI tomorrow gains, looked at that ticker. No dividend, losing money and near 52 week low?
KBH now up 13% on strong earnings. Bad news is, I don't own it but the good news is the entire sector is higher today, as you expected. KBH also expects another 30% increase in revs in 2022 along with higher margins, so the good news will keep on coming too.
BGFV Still has a large short interest (30% of float is shorted). Maybe there is more shorting today as they try to prevent getting caught in another short squeeze. I didn't see anything negative in the PR either and it is a nice beat. Maybe time to add here.
lumber prices roaring again. Futures are up to about $1200. Last May they peaked at a record high of $1600 before falling back down to below $500 last summer. This run up is starting much earlier than it did last year going into the spring building season. Could well be that another new record will be made if mortgage rates don't get out of hand. Click one year chart at the link below:
https://www.nasdaq.com/market-activity/commodities/lbs
tax loss portfolio Larry, A 5% return on a diversified portfolio held for only two trading days is great. Congrats and hanks for sharing.
CCS Wade, this guy at SA disagrees with your bear thesis and so do I:
https://seekingalpha.com/article/4475974-century-communities-stock-dirt-cheap-5-3x-pe
The supply of new homes simply cannot keep up with demand as builders are throttling sales while they continue to raise prices and margins due to the supply chain shortages. Yes, the Fed said they will raise rates next year, yet mortgage rates actually dropped slightly last week. Most builders see clear sailing even if mortgage rates rise to 4% or so.
You've been bearish on the home builder sector for a long time and missed some big profits in the group.
Go cash and lose 8% or whatever the inflation rate will be over the next year.
That is a slow bleed strategy. I'll keep doing what has worked for me over the last 20 some years. Selectively pick stocks while I keep a cash reserve to take advantage of melt downs which happen from time to time.
Not surprised to see the home builders sell off some today after the Fed says to expect 3 rate increases next year. They have also had a great run in the last month.
I remain bullish. The builders jacked up home prices on that huge run-up in lumber last spring. In fact, they have continued to increase prices since then as demand remains very strong. The supply chain issues will also prevent them from over-building as they have before. I expect margins to continue to increase over the coming year. PEs, both trailing and forward, are in the single digits...some in the low single digits. I think they have room to run, if the stock market doesn't turn south.
BGFV Started nibbling some shares here at 18.82. It could well fill the gap at 17.90 it made last may but I don't see much downside here anymore.
Debt free with over $4/ share in cash. Back out the cash and this one is trading at a f0rward 2022 PE of less than 5. Also pays an attractive 5% dividend. That is not counting $2 in special dividends they have paid this year.
Kicker is that there still is a large short interest so this could become an attractive short squeeze candidate again.
BGFV If it drops below $20, I will be buying stock back in it too. I'm pretty sure we will see another short squeeze again.
I heard a comment on FBN that 1000 stocks hit 52 week lows yesterday.
Go to this site and check the long list of stocks at 52 week lows. Then click the box and check the number of 52 week highs. Striking that while the major averages are still close to all time highs, at the same time the number of stocks at 52 week lows is at least 10 times larger than the number at 52 week highs. That sure seems odd to me. Apparently everyone is parking their money in a few market favorites and ignoring most other stocks.
https://www.investing.com/equities/52-week-low
BGFV Wade, in the interest of full disclosure, you also said you wanted to short it at $27, and that was just before it ran up to $46 on the short squeeze:
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=166611107&txt2find=46005
BMTX TDAm is showing a $14.87 cost basis per share for the BMTX shares I received in the CUBI spinoff. Nice earnings report from them btw.
HPE Those analysts sure can move stocks around with a rating change. I'm with you and also added some shares in the 14.80s.
BZH up 15% after this homebuilder reported a very strong beat in their Q4 earnings of $1.57 vs 82c estimate. Revs also beat. The CEO also issued strong guidance for next year saying he expects earnings to be in excess of $5 EPS vs $4 analyst estimate. That is a fwd PE of only about 4 on this $21 stock. Too cheap as are many other homebuilders, IMO.
BGFV up 14% today and was even higher after being noted as a short squeeze candidate again. I only have a few shares left so I am mostly sitting out this one.
Big 5 Sporting Goods Shares See Volume; Trader Circulate Benzinga Report '5 Short Squeeze Candidates To Watch: Progenity Tops List Again, Cassava Sciences Joins Following Short Report'
That big drop in the 10 year rate is real puzzling to me too. Not only is the market strongly up today but there was also a strong jobs report that came out this morning. Add to that the high inflation pressures and longer term rates should be rising, not dropping to a multi week low.
BGFV Only have a few shares left now. Last sale was a block of shares I bought over a year ago at $2.57. This stock has been a big winner for many on this board. High fives to Big Five!
Does anyone know any other profitable value type stocks with a high short interest?
BGFV Sold some yesterday but regretting it with it back over $30 now. Funny stock, in Q2 they handily beat estimates yet the stock had a big sell off. This time, they miss the analyst estimate and up it goes. Now up 25% from just 3 days ago. Looked at the transcript for the CC and it did sound overall positive.
Maybe the shorts are bailing now.
Author unknown, yet, so eloquently said.!.!.!.!
“Men, like nations, think they’re eternal. What man in
his 20's or 30's doesn’t believe, at least subconsciously,
that he’ll live forever.? In the springtime of youth, an
endless summer beckons. As you pass 70, however,
it is harder to hide from reality.
Nations also have seasons: Imagine a Roman of the
2nd Century, contemplating an empire that stretched
from Britain to the Near East, & thinking: 'This will
endure forever….' Forever was about 500 years, give
or take.
France was pivotal in the 17th & 18th Centuries; now, the
land of Charles Martel is on its' way to becoming part of
the Muslim ummah.
In the 19th & early 20th Centuries, the sun never set on
the British empire; now, Albion exists in a perpetual
twilight. Its' 95-yr-old sovereign is a fitting symbol for
a nation in terminal decline.
In the 1980's, Japan seemed poised to buy the world.
Business schools taught the Japanese management
techniques. Today, Japan's birth rate is so low, & its'
population aging so rapidly, that an entire industry has
sprung up, to remove the remains of elderly Japanese,
who die alone.
I was born in 1941, near the midpoint of the 20th Century
– the American Century. America’s prestige & influence
were never greater. Thanks to the ‘Greatest Generation,’
we won a World War, fought throughout most of Europe,
Asia & the Pacific. We reduced Germany to rubble & put
the Rising Sun to bed. It set the stage for almost half a
century of unprecedented prosperity.
We stopped the spread of communism in Europe &
Asia, & fought international terrorism. We then rebuilt
our enemies & lavished foreign aid on much of the world.
We built skyscrapers & rockets to the moon. We've even
conquered Polio, & now COVID. We explored mysteries
of the Universe & the wonders of DNA… life's blueprint.
But, where is the glory that once was Rome.? America
has moved from a relatively free economy to socialism
– which has worked so well, NOWHERE in the world.
We’ve gone from a republican government, guided by a
constitution, to a regime of revolving elites. We have
less freedom with each passing year. Like a signpost to
the coming reign of terror, the cancel culture's everywhere.
We’ve traded the American Revolution, for the Cultural
Revolution.
The pathetic creature in the White House, is an empty
vessel, filled by his handlers. At the G-7 Summit, ‘Dr. Jill'
had to lead him like a child. In 1961, when we were young
& vigorous, our leader was, too. Now, a feeble nation is,
technically, led by the oldest man to ever serve in the
presidency.
We can’t defend our borders, our history (including the
monuments to past greatness), or our streets. Our cities
have become anarchist playgrounds. We are a nation of
dependents, mendicants, & misplaced charity. Homeless
veterans camp in the streets, while illegal aliens are put
up in hotels.
The president of the United States can’t even quote the
beginning of the Declaration of Independence (‘You know
— The Thing’) correctly. Ivy League graduates routinely
fail history tests that 5th graders could pass a generation
ago. Crime rates soar, & we blame the 2nd Amendment,
& slash police budgets.
Our culture is certifiably insane. Men who think they are
women. People who fight racism, by seeking to convince
members of one race, that they are all inherently evil, &
others that they are perpetual victims. A psychiatrist,
lecturing at Yale, said she fantasizes about ‘unloading a
revolver into the head of any white person.’
We slaughter the unborn, in the name of freedom, while
our birth rate dips lower, year by year. Our new national
debt, is so high that we can no longer even pretend that
we will repay it, one day. It’s a $28-trillion monument to
our improvidence & refusal to confront reality.
Our ‘entertainment’ is sadistic, nihilistic, & as enduring as a
candy bar wrapper, thrown in the trash. Our music is noise
that spans the entire spectrum , from annoying to repulsive.
Patriotism is called insurrection, treason celebrated, &
perversion sanctified. A man in blue, gets less respect than
a man in a dress. We’re asking soldiers to fight for a nation
that our leaders no longer believe in.
How do nations slip from greatness to obscurity.?
• Fighting endless wars they can’t, or won’t win
• Accumulating massive debt far beyond their ability to repay
• Refusing to guard their borders, allowing the nation to be
inundated by an alien horde
• Surrendering control of their cities to mob rule
• Allowing indoctrination of the young
• Moving from a republican form of government to an oligarchy
• Losing national identity
• Indulging indolence
• Abandoning faith and family – the bulwarks of social order.
In America, every one of these symptoms is pronounced,
indicating an advanced stage of the disease.
Even if the cause seems hopeless, do we not have an obligation
to those who sacrificed so much, to give us what we had.? I’m
surrounded by ghosts , urging me on: the Union soldiers who
held Cemetery Ridge at Gettysburg, the battered bastards of
Bastogne, those who served in the cold hell of Korea, the guys
who went to the jungles of Southeast Asia, & came home to be
reviled or neglected.
This is the nation that took in my immigrant grandparents, whose
uniform my father, & most of my uncles, had worn in the Second
World War. I don’t want to imagine a world without America, even
though it becomes increasingly more likely.
During Britain’s darkest hour, when its' professional army was
trapped at Dunkirk, & a German invasion seemed imminent, Mr.
Churchill reminded his countrymen, ‘Nations that go down fighting
rise again, & those that surrender tamely, are finished.’
The same might be said of causes. If we let America slip through
our fingers, if we lose without a fight, what will posterity say of us.?
While the prognosis is far from good, only God knows,
if America’s day in the sun is over.”
CCS and MTH. Both of these homebuilders announced beats. CCS reported $3.63 in Q3 earnings from operations vs $3.06 analyst estimates. Revenues also were a beat and they reported an amazing 820 point increase in gross margins. Orders were down due to communities selling out faster than expected but they are adding many more lots and communities beginning next quarter. Investors are hitting the buy button with the stock now up nearly 10%.
MTH reported $5.25 in Q3 eps which was an 84c beat. They also reported record high gross margins of 29.7%. They continue to meter new sales but they are also substantially increasing their community count in the next year. Stock is up 3% now.
Again, I think the homebuilders are cheap here. CCS has a trailing PE of only 5.3 with even larger earnings expected next year.
MHO also reported an increase in gross margins although not as large as what TMHC reported. From MHO's report:
Our gross margins improved by 160 basis points over last year to 24.5%, and our overhead expense ratio improved by 90 basis points to 10.7%
That being said, it should also be noted that a year ago TMHC reported lower margins, saying their lower margins were caused by the acquisition and assimilation costs of WLH.
Last Q, MHO had higher gross margins than TMHC did (24.5% vs 21.2%).
That being said, I like both of them. In fact, I think pretty much all of the home builders are undervalued now. Some have PEs as low as 5 with strong outlooks as long as the supply chain challenges don't get too out of hand.
MHO having a rough day after reporting a miss in earnings and revs. The company earned $3.03 in Q3 which is often reported as a 44c miss. However, that number includes a 24c expense on an early retirement of debt. A 7% drop in SP today sure seems like a big over-reaction, especially considering they are now at a PE of only 5 with a good outlook.
TMHC, another builder, reported a 14c beat and is up about 9% today.
Moral of this story: Forget fundamentals and outlook. If a company misses analyst estimates, then dump it. If a company reports a beat to analyst estimates, buy, buy, buy.
The only conspiracy is by the climate alarmists which you have bought into hook, line, and sinker.
Just watch the video I linked to in my message. I would sure like to hear you attempt to refute the facts that it lays out.
Man made climate change is one of the biggest frauds ever foisted on the public by climate alarmists. Sure, the climate is changing and has been for eons. To say that it will destroy the world in short order unless we completely change our lifestyles and spend trillions of dollars in a forced massive distribution of wealth is a huge fraud. I am all for being a good steward of the environment and having clean air and water. But much of the Green New Deal is garbage and dangerous.
Here is a link to an excellent video which demonstrates how climate alarmists are cherry picking points in time to make their false arguments: