Forces of nature have managed to do what market forces haven't.
The high-flying homebuilder Wednesday said the deadly storms hitting California have prompted the company to lower first-quarter earnings guidance.
The New Jersey-based company said EPS in the quarter ending Jan. 31, 2005, will be less than its previous forecast of $1.40. Hovnanian said it is not yet able to "determine the exact impact of these weather-related delays on its earnings" but estimates the "delays in home deliveries" may trim 20 cents a share.
The consensus estimate of analysts is $1.43 a share, according to Thomson First Call.
The company, however, held to its full-year forecast of $6.50 a share on revenue of more than $5 billion. Analysts expect EPS of $6.64 on revenue of $5.13 billion.
"The torrential rainfall in California prevented us from staying on schedule to complete land development activities, exterior finishing work and landscaping, which will delay us from receiving certificates of occupancy on a number of homes," the company said. "Furthermore, power companies are focusing their efforts on repair work rather than setting meters for new homes. However, our sales backlog remains very strong and these homes will deliver later in the year."
Shares closed at $48.82 Tuesday after hitting a series of 52-week highs in mid- to late-December.