Savvy Trades and Investments

[cliffvb]

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.