NEW YORK, N.Y. ( TheStreet) -- Stocks in the homebuilder sector were mostly higher on Thursday.
(NVR) edged up 0.4% after the builder and mortgage banker
Despite the beat, NVR's profits tumbled nearly 40%, and earnings nearly 17%, from year-earlier results, as new orders, settlements and homes sold but not yet settled all declined in the quarter. NVR's cancellation rate rose to 18%, from 14% a year ago.
"With contract backlog at $1.2 billion, we see revenues rising in the mid single-digits in 2010 and 2011," noted S&P homebuilder analyst Ken Leon, who maintained a buy rating on NVR shares but lowered his price target by $40 to $720. Modeling on weaker sales, the analyst lowered his 2010 earnings-per-share expectations to $32, from $38, and 2011's eps estimate to $40 from $43 per share. "However, NVR's competitive strengths include its strong balance sheet and communities in non-Sunbelt markets."The most heavily traded stocks in the homebuilder sector Thursday were PulteGroup (PHM) and D.R. Horton (DHI). PulteGroup shares fell 0.5% in early afternoon trading while D.R. Horton pushed up 2.2%.
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