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I need to balance out the recent positive things I have had to say about the short-term prospects for the homebuilder stocks. I thought it would be useful to finally do some work catching us up with the latest news headlines. In particular, I will play back the quotes from the homebuilder executives themselves as they appear in the various earnings reports over the past two months. It is quite clear that these guys have sobered up bigtime. Being forced to reduce guidance quarter after quarter will humble even the bravest of CEOs. The cries of U-N-C-L-E are bouncing from the SF Bay Area to Florida to Washington D.C... I next hope to listen in on a few conference calls and get more complete details on what is really going on behind the curtains... (you can click the links to get the original reports). Finally, note that most of these companies are doing share buybacks. I assume that this is partially a desparate attempt to maintain earnings per share numbers, but this activity is one way that prices of these stocks just might find more support at current beaten up levels. Brookfield Homes (BHS: July 20, 2006)
I think you get the point now, right?!? Be careful out there! |