Lennar's earnings will define this week
The homebuilder performance this week should tell us what we need to know about the sector.
If there could be one quarter that might define this week, it will be Lennar's (LEN) on Tuesday. Here's a high-quality national homebuilder that had a very good quarter last time out.
Lennar jumped up a couple of bucks on the big move in U.S. Treasury interest rates as money rotated right back into homebuilders when the Federal Reserve whamma jamma'd the bears.
Now, Lennar was the most bullish of all homebuilders going in to the last quarter, when it had improving gross margins, low cancellations and a huge backlog. All three, if you listen to the bears, are in jeopardy, particularly since this is a quarter that has taken place entirely amid the elevated new mortgage rates.
There are two components to this quarter. First, is this possibly the last good quarter because the mortgage lock-ins are now over? Or, second, have rates stabilized or gone lower now, meaning that buyers are coming back into the market?
We had a hideous market Friday almost entirely because of Washington fecklessness. I think at a certain point that will be built in, but not yet.
Still, Lennar is the tell. If it rallies, we'll know there is a new place to go. If it doesn't, I think the homebuilders may not be a place to be for a very long time.
Jim Cramer is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Follow his trades for Action Alerts PLUS, which Cramer co-manages as a charitable trust and has no positions in stocks mentioned.
More from TheStreet.com
Something's wrong with a Society that goes out and spends, hundreds of dollars a year to have a phone and stay connected 24/7 with friends and acquaintances..
Then lives in a basement at home with Parents, that are living on Food stamps and about to be evicted from a house in Foreclosure...
In spite of less being in the Stock Market but Cash instead, the SuperRich still set a new all time Record for total Wealth in 2013, and it's growing by leaps and bounds. By the way, America reclaimed it's top spot of most millionaires from Asia. Not bad for them, how's it working out for the rest of us.
They buy Mega-Mansions, while we are stuck with overpriced Homes with the newer ones suffering greatly in quality. They don't build too many things like they use to, you know the pride that meant it would last. Not so much for most things you put in your home.
Folks harping on those on Food Stamps tend to forget the larger problem of Subsidized Corporations living off the Government Dime. Current count, Uncle Ben printing a Trillion a year in subsidized aid.
And it all comes back to homes and the Money Changers that built a fortune off of misleading the Public by creating farce triple AAA investments while at the same time giving out loans to folks that they knew could never pay them back. All without any arm twisting from the Government. This was pure and simple GREED. Corporations controlled the Government, that's why nobody went to jail. Just more hush money.
Dave I'm going to say right up front....You don't read well, understand or seem to get a point...
NOBODY said you "don't need" a phone for occasional conversation, we have several..
WE also probably have about 5 different methods of "contacting" ourselves or household.
Not counting a "snail mail" mailbox or driving up our driveway...WE CAN AFFORD IT.
Was someone spending hundreds of dollars, staying connected, with a pretty phone.
While living in their Parents basement...
Parents and them on FOOD STAMPS..
Living in a house about to be FORECLOSED ON.....kapish.??
Globalization is the cause.
Nationalism is the solution.
For most of America, the next few years and decades will wax worse.
As manufacturing and assembly is moving overseas, eventually every industry will shed workers.
The American wage, benefits, pensions and government cost structure cannot compete in a global economy.
Stop immigration and tighten trade borders or welcome additional lowering of the standard of living in America. Even Obama's socialist dream cannot subsidize this to make everything look peachy.
DLH2448:Your problem isn`t near as bad as Larry Ellison`s problem.As CEO of Oracle,
his compensation went down 18.5%.In 2012 he made $96,200,000.Now he`s down to
only $78,400,000 for this year.I`m going to send him some TV dinners or hamburger
helper.If only we could cut the minimum wage from $7.25 an hour to something more
reasonable,like $2.00 maybe he could get a raise.
No doubt there are pockets of building out again of Residential units...
Although I read about Multi-family, apartment buildings and such, we are more or less becoming a rental or lease society...
Back a couple months ago, I was on a 2000 mile road trip...Round trip, but took part of it on two different routes, covering roughly parts of 7 different States.
Although there was bustling activity in some centers of population; It still looked as if people were struggling to get by...Some working two jobs; Others after retiring from one, working again at another job full or part-time, because of young age or having extra cash for other expenses.
The Housing situation seemed a little off balanced, because of noticing between 10-20% of them being empty...Some recently,others had been abandoned for a few years and falling into disrepair.
That was on outskirts of some cities or towns, smaller towns had similar numbers with a lot of for sale signs maybe even bank owned for sale...
Rural areas seemed worst, especially in depressed States or areas, somewhere between 25-40% of homes were empty...As if people got stressed and just moved away or had lost everything.
Most were not even for sale or listed...A few had been empty for years..
For Sale signs were only on higher priced properties, many with REDUCED signs attached.
Businesses fared just as bad, with some places having 30% or more of empty spaces; In many cases business that would have been supported by other Larger operations that had closed...
As far as a big City, Detroit would be a prime example of trickle down despair...
Other small towns that had a robust employer with a niche business, seem to be doing much better and the Community displayed a much better attitude about the recent Recession.
The road trip was an eye opener for me of what was/is really going on in Mid-America.
there's a ton of new building here in so cal again. complexes for 200 people here, 500 people there; several thousand just down the road 5 minutes. serious building. it was delayed several years and now going at it in full steam.
the population is still growing. albeit slowly with delayed marriage and births, but it is still growing. the people will need to live somewhere.
Why do people complain about being upside down on their house.You canlive in your
house.You can`t live in a stock that`s down from where you bought it.
The Housing Market has been a FARCE since the Big Banks have corrupted the system and created this mass Bubble which by the way, some are trying to re-inflate. These day, you don't know if real folks are buying homes are just some investment group.
Fact is, we are a Fiat Based system that's been living off Printing Money for decades. Yet that wasn't enough, Big Banks Greed created faker money called Derivatives. Aka the Reason for Global FEDS printing to infinity. The Global FEDS will eventually lose control and then it's game over.
Dave.... Glad you will only ADDRESS IT ONCE....I'm about as upfront as they come..
Not only on stupid posting boards, but in real life also...
I do NOT need anyone to re-explain my post; If they don't understand, they can ask for clarification.
I do NOT need any credibility from YOU....Get off your high horse.
I shidt bigger turds then YOU.
And I inject or misdirect when I feel the need to, or sometimes when someone is blowing bullshidt..
That may not be the case with you...But if thy shoe fits, que sera, sera .
I do not know about the purpose of scrutiny, concerning many of the posts; Because many of them are written from opinions...If outright lies, they should be called on...Otherwise it makes no difference.
As far as "my type" on these boards ??? I don't even know what that means.??
I hardly mind real honest scrutiny because that's how we learn, from others. Therefore we can agree to really not give a darn about directly responding to each other. However, any and all post including mine are subject to scrutiny. That's the nature of the beast.
Although seeing little building going on around us...
Other places fairly noticeable are Multi-Family units...When and if, anything is being built.
Occasionally a high end house built for someone with lots of dough or damn good jobs.?
I think retiring boomers are adding to the building, but believe many are mostly remodeling.
Unless they are downsizing or going Condo...?
One item of good news about being upside down in your home or mortgage..
Not to make light of it; But you are still in a home...And best of luck in staying put.
Better days are coming..
Our first home bought in the early-mid-60s was a 2 bdrm./ sing. bath/attchd. garage/basement.
Decent suburb plat..4 years later we sold it for 50% more in appreciation..
We sold the home ourselves(no realtor) and signed a buyer/s in less then 1 week.
Had to fix a couple minor items, for FHA or VA ? About $250-300 out of pocket and moved in 30 days to the country...25 miles away.
As we know today, that scenario has reversed itself, for the most part.
Copyright © 2013 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
Each of these movers and shakers is being propelled by gale-force industry trends. Investors could reap huge rewards.
VIDEO ON MSN MONEY
Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.
Contributors include professional investors and journalists affiliated with MSN Money.
Follow us on Twitter @topstocksmsn.