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LGIH Up 5% to down 10% on an earnings beat?
Another case of buy the rumor and sell the news?
LGIH Those strong earning numbers shoots the stock to $80 area and also a new 52 week high.
CCS reports after the close.
BMCH up 12% on a strong beat. eps of 29c vs 12c estimate in their seasonally weakest quarter. This company is a lumber and materials supplier to the home builders. Made no sense that they were hitting 52 week lows recently while the builders were all going gangbusters. I also figured high lumber prices would help their bottom line.
Nice when a plan works out. I'll also hold this one for awhile.
I was really surprised when the market started down after the unemployment report came out. It was not so hot that the Fed needed to slam on the brakes but not so cool that the economy might be heading back to recession.
With 164K jobs added last month and unemployment at a 17 year low, it was "just the right temperature", imo.
As hweb said, "Go market go!".
"oday, she may be responding to the general poor economic news that came out this morning, imo."
What is the poor news out this morning? I must have missed it. About all I see is that the US trade deficit dropped, which I think is a postive.
Yet, all 30 stocks of the DJIA are down now.
BZH and MDC are two more homebuilders out with strong earnings reports. For BZH, eps was 36c vs 16c estimate for the quarter and revs also beat estimates. Margins up and backlog is also nicely up by 14%. BZH is up 10%. MDC also had a nice beat with 68c eps vs 53c estimate and is up 8% today. Homebuilders outlook is strong despite an uptick in interest rates. I'll also probably add some CCS ahead of their earnings next week.
BZH Q2 (Mar) earnings of $0.36 per share, $0.20 better than the Capital IQ Consensus of $0.16; revenues rose 7.0% year/year to $455.2 mln vs the $439.15 mln two analyst estimate on a 2.2% increase in home closings to 1,266 and a 2.3% increase in average selling price to $348.4 thousand. Homebuilding gross margin was 16.9%, up 90 basis points. Unit orders of 1,679, up 8.4% on a 10.3% increase in sales/community/month to 3.7 and a 1.7% decline in average community count to 151 Dollar value of backlog of $885.4 million, up 14.0%
TSLA They only lost $3.35/ share or about $710 million last Q. Show me another stock trading at $300 which can do that, lol. I'm tempted to join you on your short.
CAI can't hold a rally? Up 15% since earnings last week (in line with estimates) and also up 4% today. It had been a poor performer but I think it has turned the corner. No more talk of a challenging environment. Company announcement of a stock buyback helps too.
MU This is what Apple's CFO said about memory prices:
“ And also on the memory front, we feel that for NAND, we're going to be turning the corner very soon. For DRAM, we also think that we are near the peak, possibly at the end of this year. And so that should provide some level of stability.”
Looks to me like he said Dram prices will stabiliize. If they stop rising and then stabilize at higher levels, MU will remain a money making machine.
MU Encouraging to see it up now on another down market day. Semi and memory stocks have been having a rough go of it lately. Latest example is Seagate STX which announced an earnings beat, $1.46 vs $1.32 estimate and also a 5% revenue beat in fiscal Q3. Stock was up slightly in premarket but then boom, it's now down 10%. Reminds me of what happened to Intel last week.
Last week the market was worried about interest rates. It looks like the fear flavor this week is inflation which is drowning out all the earnings beats.
NRZ Can't disagree with your comments but I would point out that the book value increased from $15.25 to $16.85 in just one quarter. Mgmt also commented in the CC that they see further gains going forward as well. This helps to put a floor under the stock and also helps explain the stock price increase since earnings came out.
The high rates occurred under Fed Chairman Volcker who was fighting high inflation head on. Volcker was first nominated by Carter in 79 and then Reagan renewed his nomination 4 years later. I don't remember 15% on savings but I didn't have any savings then either, lol.
Intel was up 8% AH yesterday AH on a strong beat and guidance. Today it has given back all its gains. Only thing I see is a delay in getting a new memory chip in volume production. Taking much of the rest of the sector down with it too.
Sure kicking myself for not selling my INTC afterhours yesterday.
Homebuilders are more dependent on LT interest rates ie mortgages. I think both the movement in 2 yr rates and homebuilders shown in the chart were a result of a giant housing bubble and then the great recession that followed when the housing bubble burst.
Cracks me up how people are sweating that 10 year rates are hitting 3% now. When I started my homebuilding business in the early 80s. I was soon greeted with mortgage rates as high as 18% and construction loan rates as high as 22%. That was a real adventure, lol.
CAI No more cautious outlook with their weakest quarter behind them. Thanks for summarizing the CC highlights. I also like management's summary of their outlook:
In summary, we expect 2018 to be a strong demand year for containers as the global economy continues to expand and lessors continue to operate with high utilization. CAI is well positioned to continue to benefit from the investment opportunities and we expect 2018 to be a record year in terms of revenue and net income.
INTC beat estimates by 15c and alsoraised Q2 and 2018 guidance. Up about 8% AH.
This should help send semi stocks and maybe the entire market higher tomorrow.
CAI seems to be priced for a disappointment so, yes I'm also holding into earnings.
New homes and BMCH - Nationally there is a shortage of used homes so the only way to make that up is for the builders to build more new ones. As the home builders are doing very well, I also picked up some BMCH this morning. This one is a lumber and material supplier to the builders. Seems like they should also do well, yet they are at a 52 week low. Also with lumber prices high now, that should help fatten their margins.
10 year treasuries hit 3% earlier today could be part of it. It amazes me that we finally have a stronger economy and investors are acting like yields shouldn't start heading higher with this. More good than bad earnings reports but investors seem focused on 3M which is down big today.
Other than that, Minuchen is going to China to talk trade with them. Investors are apparently worried that won't go well either.
Other than that, I don't know of anything other than the pattern of late: Open higher and then fall more and more as the day goes on.
PHM Home builders up today on strong report and guidance from PHM, the first to report.
From Merrill Lynch:
PHM reported 1Q18 EPS of $0.59, above our $0.48 est and cons of $0.45. Orders rose 12.2% YoY (BofAMLe 11.2%, consensus 8.9%). HB gross margin of 23.6% (BofAMLe: 23.0%) was above our forecast, as was the operating margin of about 11.0% (BofAMLe 9.7%). We believe PHM's results are further evidence that the homebuilder stocks are staged for meaningful recovery.
LRCX I believe they report after the close today. I would assume that Cramer was talking as much about Lam's guidance and outlook for the chip industry affecting MU. Lam had a strong beat last Q, btw.
MU Apparently, Cramer turned bullish on MU a day before it peaked. Using him as a contrarian indicator worked again. From his March 12th commentary:
"I've been telling you that something like this was on the horizon," Cramer said. "Micron's the backbone of everything from the personal computer, which has gotten a second wind, to the data center, which is the strongest part of the entire food chain."
Many market-watchers thought Micron was approaching the "bust" part of its boom-bust cycle. Because DRAM and flash memory chips are so easily replicated, they worried that the market would become over-saturated.
"But Micron's been adamant that this time is different, that their chips are now more specialized and proprietary, harder to make," Cramer said. "However, as I say often, ... the graybeards simply refuse to believe that anything can ever be different."
"In the case of Micron, it turns out that this time it is different," he quipped.
Not only are Micron's chips not being replicated, but they are in short supply, Cramer said. With personal computers selling again and data centers becoming increasingly essential to business, chips are needed more than ever, he said.
....
Cramer then went on to recommend INTC, another chip maker,. which has been flat since then.
I wonder if Cramer has turned negative on MU again? That could be a signal to Buy, buy, buy, lol
I've also noticed that Amazon is not always cheaper. Often others such as Ebay and sometimes Walmart online beat them. I also see that everything on Amazon has sales tax added to it now here in Washington state, even from 3rd party vendors, including Canadian sellers. Odd that others don't do that.
Can't beat the Prime 1-2 day shipping though.
Banks are weak today even though 2 out of 3 of the big banks that reported earlier were beats over analyst estimates. Buy the rumor, sell the news.
A also hold some BAC and have been on the fence about it. Since banks are down today, I'll hold into BAC earnings on Monday.
Homebuilders have had quite a sell off from their peaks early this year. Investors have sold them off apparently due mainly to concerns over higher interest rates. Yet, I hear of strong buying interest as we enter the spring selling season. Some are even closer to their 52 week low than 52 week high despite turning out higher profits.
I think there are some good buys there now though as we move into their spring selling season. I also think most will be reporting stronger than expected results for their first fiscal quarter along with strong guidance. LEN, the country's largest builder gave a heads up with a recent strong ER and guidance.
Three I like are CCS, TOL, and MDC. MDC is unique in that it also pays a 4.2% dividend after recently raising it. Dividends are rare in the group.
Several report earnings on 4/25 including CCS.
MU You're right, most analysts predict lower earnings by 2020. I have access to Merrill Lynch's reports and they are estimating that 2020 earnings will be $8.38. So a current forward PE of 6 in the low cycle? That sounds way too cheap to me.
Don't see where MU ever hit 51 but it has gone from up to down along with the market. From your comment Wade, it sounds like you bought some?
80% of Trumps tax cuts go to foreigners???
So how is this? Foreigners are paying USA income taxes and they make most of the income so they also benefit the most???
Newsweek has really flipped out over this if you ask me.
They also got their facts from Senator VanHollen, who is a very liberal democrat from Maryland.
lol, Ryan will definitely have a tax cut as he will be unemployed come January. Rumor is that he wants free time to start his own run for president in 2020.
SYNA Up 9% after Mizuho analyst issued a buy rating and raised target to $55 from 42. LCD sales to Apple are expected to rise sharply.
Shares of Synaptics Inc. (SYNA) are up 2.3% in premarket trading Wednesday after Mizuho analyst Vijay Rakesh upgraded the stock to buy. He said the second half of the 2018 calendar year could be stronger than expected for the LCD Apple Inc. (AAPL) iPhone market, which is a potential source of upside. "While LCD was supposed become obsolete with OLED, high OLED panel prices (4-5x LCD panel prices), and low yields at other Korean and China OEMs outside of Samsung ...we believe 2H 2018 could see LCD iPhones at 60% of the mix versus 30-50% of new iPhones in 2H17, creating a tailwind for Synaptics," he wrote. Rakesh also said that the second half of the year is typically better for sales of voice assistants. He raised his price target to $55 from $42. Synaptics shares are down 15% over the past 12 months, while the S&P 500 has gained 13%.
MU showing continued recovery today. There was an article in SA responding to that 40 some page sell report from UBS. The author noted that the UBS report did not read nearly as negative as its headline. Also noted that the UBS report talks about a 170K monthly increase in the supply of Dram chips in the second half of this year but never says where all those chips will come from. Nobody else seems to know that either.
I also noticed that Merrill Lynch increased their target for MU to $85 from $70 last month. They are projecting $8.29 in eps for 2020 which will be the next down cycle. (fwd PE of 6 based on current price). They also expect MU to start paying a dividend of 3% or so by the beginning of their next fiscal year.
I'm holding too.
https://seekingalpha.com/article/4161496-truth-ubs-micron-report
Arizona, you are delusional. A while back you said that Prez Bush should have gotten congress to approve funding for a war responding to an attack against us (9/11) when it nad not even happened yet.
You are lving deep in la-la land.
"The 1% grabbed 82% of all wealth created in 2017"
That's mainly because they are also the biggest investors in the stock market, either directly or through funds. The stock market had a very good year last year so, of course, they did very well.
Want to equalize wealth, aka socialism? Ask the people of Venezuela how that is going for them.
China continues to enjoy developing nation status in the WTO despite the fact that it has now become the world's 2nd largest trading partner after the US and will also overtake us if their status doesn't change to developed nation.
The problem is that WTO, along with other international organizations like the UN, don't seem to like us so who knows where all this "trade war" rhetoric will end up at.
It creates a wildcard for stocks in general and companies like MU in particular that rely on world trade. Strap on your seatbelts.
MU Wade, What makes you think the cycle is over?
Dram prices are very close to record levels. Most industry experts see further price increases coming as well.
Unlike the previous cycle, there are now only 3 major manufacturers of Dram: MU, Samsung, and SK Hynix. All plan only moderate increases in production. Secular demand is growing faster.
2 years minimum before China becomes a factor and then only if they steal the current technology.
Nand chips likely have peaked but they are only 28% of MU's sales and an even smaller percentage of profits.
R59, Nice buy on MU afterhours yesterday. Stock is now green. After meeting with MU's CFO, the Nomara analyst thinks MU will earn $12-14 eps over the next year and maintains his $100 price target (from SA).
MU Also added at 49.50. I just checked and that UBS analyst was not on the recent conf call either. He also had not come out with any new recommendations for 8 months. Suddenly a big sell on MU out of the blue. Definitely looks like he's trying to make a "splash" here.
Hopefully, he'll go down in flames.
I think the ER from Samsung tomorrow will get MU back on track.
MU That UBS analyst was an Apple analyst at Cowen. He should have stuck with his area of expertise. Samsung is reporting earnings on Friday and is also the largest Dram chip supplier. I expect they will also provide positive guidance on chips. Here are some comments on the coming report from another analyst:
Disciplined supply will mean the global memory chip market will remain tight throughout this year and help Samsung report record earnings, although profit growth is seen slowing to just 15 percent from last year’s blistering 83 percent.
“Although memory chip price growth is expected to slow down from last year’s boom, increased shipments and cost-cutting will fuel further profit growth in Samsung’s semiconductor business and lift profits to another record year,” said Lee Jae-yun, an analyst at Yuanta Securities Korea.
https://www.reuters.com/article/us-samsung-elec-results-preview/samsungs-first-quarter-profit-seen-at-13-7-billion-as-dram-chip-margins-soar-idUSKCN1HA2VG
MU That must be UBS as in Unadulteraded-Bull-Shit analyst. Apparently he sees Dram prices starting to rollover in 2 quarters. I don't see any way that will happen. Unlike a few years ago when there were about 7 major suppliers of Dram chips, there are only 3 now; MU, Samsung and SK Hynix. All 3 of them have said they plan only moderate increases in supply which probably won't even keep up with growing demand. China is at least 2 years out and it could be much farther if they can't steal the technology.
It reminds me of yesterday when the market tanked on news of proposed tariff increases by China in their chess match with the US. The market then came back to its senses. UBS has likewise created a good buy point for investors in MU, imo.
LEN Great report and a very positive outlook too. Notice that new orders exceeded deiveries by 10% even in a slower period seasonally. From the PR:
Stuart Miller, Chief Executive Officer of Lennar, said, "As we report our first combined quarterly results with the CalAtlantic strategic acquisition now completed, we remain enthusiastic about both our current results as well as our future projections under the Lennar platform. In the first quarter of 2018, pro forma new orders and deliveries were 10,910 and 9,994, respectively, which exceeded the expectations for both companies. The integration is progressing exactly on target."
Mr. Miller continued, "Our first quarter results begin to display the true power of this combination. Although these results do not include 2 ½ months of CalAtlantic's operations, all company metrics have performed as expected or better and we have grown more confident in our ability to exceed our $100 million synergy target in 2018 and we are on track to meet our $365 million synergy target in 2019."
"We continue to remain positive on the outlook of the housing industry in general. Although interest rates have ticked up, unemployment remains low, the labor participation rate has been increasing, and wages have been moving modestly higher, though we think, even higher than the data the government captures. Feedback from our new home consultants indicates that our customer base feels confident in both job security and compensation levels in spite of the political noise that abounds."