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Crunch Time at Ryland, Pulte Homes

However, Starwood's earnings may be the worst of the bunch. The hotel operator -- which I rate "own" -- cut its guidance for the rest of the year, far below analysts expectations.

Starwood is facing slumping demand for its owned and managed hotels in the U.S., while international operations have held up better.

The stock is trading down 10% today, but is also now trading at a depressed P/E multiple not seen since 1999-2000.

Let's break down the results from each of these companies.

Homebuilders: Pulte, Ryland

The story on the homebuilders has not changed. The firms cannot make money because home prices continue to fall, which is forcing the companies to sell houses at a loss just to create cash flow to service their debt.

However, Pulte's results today looked much better than Ryland's. In an environment where oil is rising and home prices are adjusting downward to correct the supply/demand imbalance in the market, builders can really only do one thing to help themselves: cut expenses where they can.

Pulte did just that. Despite its ugly net loss of $158 million, the builder cut its selling general and administrative expenses by $118 million, or a 40% cut from a year ago.

The SG&A expenses as a percentage of homebuilding revenue totaled 11%, down from 15% a year ago.

Most of Pulte's quarterly loss was due to $220 million of impairment charges related to land on its balance sheet that has fallen in value. If you add back those impairment charges, which are meaningful but non-cash, then Pulte ended up with a 12% gross margin in the quarter. That's not too shabby.

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