This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Homebuilders and Related Suppliers Are Set to Build a Rally

NEW YORK (TheStreet) -- Each month I provide updated "crunching the numbers" tables for the 19 components of the PHLX Housing Sector Index after the release of the National Association of Home Builders Housing Market Index and the release of housing starts. The housing sector index is down just 0.9% year to date.

The 11 homebuilders in the housing index declined after weaker than expected housing data in June trading and the housing index set its 2014 low on July 31. Better than expected data reported this week helped homebuilder shares recover.

The biggest winners among the homebuilders since I wrote about them last month are Standard & Pacific (SPF - Get Report) and M/I Homes (MHO) up 4.5% and 3.4%, respectively.

Read More: 10 Stocks George Soros Is Buying

Better performances come from three companies that provide products and services to the housing market. Home improvement and building products company Masco (MAS - Get Report) is up 13% since July 24. The provider of private mortgage insurance Radian Group (RDN) is up 7.7%. Timber and forest products company Weyerhaeuser (WY) has a gain of 6.4%.

Here are the bullish data releases for housing:

On Monday, the National Association of Home Builders Housing Market Index rose two points to 55 in August.

On Tuesday, the U.S. Deportment of Housing and Urban Development and the U.S. Census Bureau reported housing starts rose 16% in July to a seasonally-adjusted 1.093 million units. The important component for homebuilders is single-family housing starts, which popped 8.3% in July to 656,000 units.

The above graph presents the NAHB Housing Market Index and single-family home starts. Even after this good data I still view the market for new homes stalled at 60% of potential.

Read More: Warren Buffett's Portfolio Proves He's a Dividend Growth Investor

At 55, the HMI is above the neutral 50 but below 60 on a scale of 00 to 100.

1 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
MAS $26.33 -0.23%
SPF $8.62 0.35%
AAPL $129.05 -0.24%
FB $80.21 0.77%
GOOG $573.56 -0.01%

Markets

DOW 18,113.69 -89.68 -0.49%
S&P 500 2,096.64 -11.14 -0.53%
NASDAQ 4,962.8350 -17.0660 -0.34%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs