Hovnanian Enterprises reported a third consecutive quarterly loss

Discussion in 'Wall St. News' started by S2007S, Jun 1, 2007.

  1. S2007S

    S2007S

    Is the bottom in yet???





    :p :p :p :p :p :p :p


    Hovnanian Enterprises (HOV 25.26) reported a third consecutive quarterly loss, and withdrew its earnings guidance for the year, citing increased uncertainty in the U.S. housing market. Shares of the Red Bank, N.J.-based homebuilder traded lower on the news, losing roughly 2% in pre-market activity.

    Like many homebuilders, Hovnanian faces challenging conditions in many of its markets, as the supply of houses continues to outpace demand and recent problems in the sub-prime lending market have made it difficult for some potential buyers to qualify for a mortgage. Since the beginning of the year, the company has seen its stock tumble more than 25%, and with demand continuing to slow and inventories rising, the slump is likely to continue.

    For its fiscal second quarter, Hovnanian posted a loss of $30.7 million, or ($0.49) per share, versus a year ago profit of $101 million, or $1.55 per share. Earlier in the May, the company said it expected to lose between ($0.45) and ($0.50) per share in the quarter. Analysts on average were expecting a loss of ($0.48) per share.

    Revenue for the period fell 29.4% year/year to $1.11 billion, slightly below the consensus estimate of $1.13 billion, as the housing market continued to slow in many locations in terms of both sales pace and sales prices. The company delivered 3,150 homes with a sales value of $1.1 billion in the quarter, down 30.8% compared to deliveries of 4,555 homes with sales of $1.5 billion last year. Homebuilding gross margin slipped 740 basis points to 16.3%, due to lower prices and increased sales incentives to buyers to close homes.