kbh housing et al

Discussion in 'Stocks' started by scriabinop23, Sep 26, 2006.

Are home builders at bottom right now?

  1. Yes

    0 vote(s)
  2. No

    6 vote(s)
  3. No, but don't hold your breath on another round of selling for another few months !!

    3 vote(s)
  1. GOD DAMN IT!!! When will my shorts start working for me? :)

    I mean, for heaven sakes, this has been discussed to death -- nothing but bad news on these housing stocks, and they seem to be amongst the strongest performers in the market day after day this week.

    My theories:

    1) Housing stocks are merely proxies for the bond market (which has done well).

    2) The general market as a whole GENUINELY believes that this housing 'collapse' is merely a correction and that this downturn is not a long term cycle. Do people really believe cheap mortgages will bail the housing industry out and change the market bias??

    I just can not rationalize why home builders are not at 2002 price levels if the market believed that these cycles are long and will be deep (which I believe).

    Any ideas? I like KBH as a short because of so much California exposure.
  2. Take note, interest rates may be going down so it could temporarily boost housing stocks. However, I'm with you on this one. Shorted

    TOL @ 28.05
    KBH @ 45.50

    Not a lot of shares though so these stocks could triple and I'll still be ok. It's more of "testing the waters" play before I start adding heft behind the short plays.
  3. I'm short kbh avg 43.67 ... so now you know why I'm bitching.

    On the other hand this past bond market rally seemed a little overdone --- hopefully some retracing will help our shorts.
  4. Lennar is a great 2-3 month short play right now.

    Lennar is heavily concentrated in massacre markets (think Florida).

    The bulls can't fight the shorts forever. They can only hope to cover short term.

    Housing is in meltdown.
  5. Personally, I think the bond market has more room to go. There may be a little correction but it won't stop it from going up further.

    I think there's more to what's going on than just interest rates that will take this market down.
  6. Are you guys kidding me....you are trying to call a top, in a market that is hitting new highs. For these shorts to work out, you need both the stock and the market to work in your favor. Best of luck on these trades.
  7. true. rising tide rises all ships, except energy tankers. :)

    by the way --- I am getting deep into these quarterly reports on SEC EDGAR, and am attempting to find the purest play on homebuilder with bubble markets (socal, nevada, florida, etc). Does anyone know better than Lennar or KBH ?

    These builders are well diversified in their geographic exposure, generally.

  8. Most housing stocks are not hitting new highs; they're literally 50% to 70% off their highs.

    That must be some good crack.
  9. I'm sorry...for the reading impaired...let me translate. You are shorting stocks in a market that is making new highs....get ready for some pain. How many times will you add?
  10. Can the housing market act independent of the broader markets, as they have over the past 6 months?

    #10     Sep 26, 2006