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Taking a Fresh Look at Homebuilders

This column was originally published on RealMoney on Oct. 25 at 8:37 a.m. EDT. It's being republished as a bonus for readers.

About a month ago, I devoted a column to an in-depth look at how far the homebuilder stocks could fall.

Homebuilder longs thought I was bashing the group, but rather, I was just looking at the worst possible scenario.

Frankly, I haven't heard much from that group since, as the continuing decline caused the critics to go into hibernation.

Too bad, as some of the stocks are starting to look attractive.

Therefore, a follow-up is in order, so today I'm going to take a look at Toll Brothers (TOL - Get Report), Beazer Homes (BZH - Get Report), Pulte Homes (PHM - Get Report), Hovnanian (HOV - Get Report) and KB Homes (KBH - Get Report).

The first chart will be from Sept. 28, when I did my worst-case analysis, and the second chart is the current one.

It's fairly interesting (chart) reading.

And that is the final word from the Federal Reserve, where all this talk about Bernanke is amazing.

Was there any discussion when Greenspan came aboard?

P.S. from Editor-in-Chief, Dave Morrow:
It's always been my opinion that it pays to have more -- not fewer -- expert market views and analyses when you're making investing or trading decisions. That's why I recommend you take advantage of our free trial offer to RealMoney premium Web site, where you'll get in-depth commentary and money-making strategies from over 50 Wall Street pros, including Jim Cramer. Take my advice -- try it now.

Charts produced by TC2000, which is a registered trademark of Worden Brothers Inc.

Gary B. Smith is a freelance writer who trades for his own account from his Maryland home using technical analysis. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Smith writes a daily technical analysis column for and also produces a daily premium product for called The Chartman's Top Stocks -- click here for a free two-week trial. While Gary cannot provide investment advice or recommendations, he appreciates your feedback; click here to send him an email.

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BZH $14.56 -0.75%
KBH $14.13 0.86%
HOV $1.83 1.70%
PHM $19.61 -0.25%
TOL $37.58 -0.82%


Chart of I:DJI
DOW 17,797.16 -1.33 -0.01%
S&P 500 2,086.81 -3.30 -0.16%
NASDAQ 5,120.30 -7.2250 -0.14%

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