Homebuilder Stocks: Winners & Losers
NEW YORK (
) --
Stocks in the homebuilder sector were mostly higher Monday morning, thanks to a
better-than-expected quarterly report from builder
Lennar
(LEN) - Get Lennar Corporation Class A Report
, posted before the opening bell.
Homebuilder stocks shrugged off a tepid report from the
the National Association of Home Builders which showed its index of builder sentiment was flat month-over-month in September as high unemployment and high foreclosure rates continued to dissuade people from considering new-home purchases.
>> Homebuilder Sentiment Holds Steady
.
Leading the sector higher was Lennar, which jumped 8.3% in early-afternoon trading, after the company said its third-quarter earnings were $30 million, or 16 cents per share, a reversal from a year-earlier loss of $171.6 million, or 97 cents. Analysts expected a profit of $7.1 million, or 5 cents per share.
Revenue rose 14.5% to $825 million, easily beating expectations for sales of $777.5 million.
>>Lennar Beats on Return to Profitability
TheStreet Recommends
Stifel Nicolaus analyst Michael Widner noted that, based on Lennar's report, the read-through for other industry players was mixed with "the greatest positive indication for
NVR
, which is heavily concentrated in the mid-Atlantic."
The analyst said implications are negative for
KB Home
, due to report its quarterly financials Friday, because of its high concentration of business in California, a market particularly hard hit by unemployment and foreclosures.
Shares of NVR added 1.2% while KB Home gained 5%.
Other sector winners included
Hovnanian Enterprises
(HOV) - Get Hovnanian Enterprises, Inc. Class A Report
and
Beazer Homes (BZH) - Get Beazer Homes USA, Inc. Report, which warned earlier this month it was no longer sure new-home orders in fiscal 2010 would be higher than fiscal 2009's level of 4,205 homes
.
>>Beazer Homes: Hard Times Ahead
.
Beazer cited slower-than-anticipated improvements in new-home orders after the
springtime expiration of federal tax credits for homebuyers
. The company said prospective homebuyers continue to exercise caution in committing to a home purchase as general economic conditions still haven't showed enough improvement.
Beazer shares were 5.4% higher with just over two hours left in the trading session while Hovnanian added 5.8%.
Bucking the trend was
Weyerhaeuser
(WY) - Get Weyerhaeuser Company Report
, a forest products company that grows and harvests timber but is also engaged in developing real estate and constructing homes. Its shares fell 1.7% on Monday.
The
SPDR S&P Homebuilders
(XHB) - Get SPDR S&P Homebuilders ETF Report
, an exchange-traded fund that tracks the sector, gained 2.6%.
-- Written by Miriam Marcus Reimer in New York.
>To contact the writer of this article, click here:
Miriam Reimer
.
>To follow the writer on Twitter, go to
http://twitter.com/miriamsmarket
.
>To submit a news tip, send an email to:
.
READERS ALSO LIKE:
>> 18 Overbought Stocks to Sell Now
>> 12 Dividend Stocks Increasing Payouts
>> Dividend Paying REITs: Two Harbors
>> Bankruptcy Watch: 20 Riskiest Restaurant Stocks
>> Bankruptcy Watch: 10 Riskiest Hotel Stocks
>>See our new stock quote page.
Get more stock ideas and investing advice on our sister site,
Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.
