By Ken Shreve

With the iShares Dow Jones U.S. Home Construction (ITB) ETF up nearly 200% since October 2011, all the good news has to be priced into the homebuilders already, right?

Maybe not, if recent earnings reports are any indication.

Early Tuesday, D.R. Horton (DHI) reported solid results with earnings up 122% from a year ago to $0.20 a share. Sales rose 41% to $1.28 billion. The results handily beat the Thomson Reuters consensus estimate of $0.14 a share and sales of $1.1 billion.

While many homebuilders are too far extended past proper buy points to consider buying now, D.R. Horton is in a different boat. It staged a technical breakout on heavy volume Tuesday, soaring 11.8% to $23.82.

As of Tuesday's close, DHI was 4.5% above its recent high buy point of $22.79 -- still within buying range. It's generally not prudent to chase a stock when it moves more than 5% past a buy point.

The stock is very liquid with an average daily volume of 5.6 million shares. Volume on Tuesday totaled 22.3 million shares. A volume surge like this means that much of Tuesday's move was driven by institutional buying.

Meanwhile, after the close Tuesday, Ryland Group (RYL) also reported stout numbers. Earnings surged 833% to $0.56 a share, while sales jumped 68% to $440.1 million, also nicely above consensus.

The issue with Ryland Group is that it has run a lot already and needs to consolidate gains before a new buy point emerges. Buy now and you'd be chasing. The last breakout for Ryland Group was when it cleared $35.84 in December. Headed into Wednesday, it was 15% past the buy point.

Other builders that fall into the "extended" camp are Lennar (LEN), Standard Pacific (SPF) and PulteGroup (PHM).

Meanwhile, MDC Holdings (MDC) is still in a base and hasn't broken out yet ahead of its earnings report Thursday. Meritage Homes (MTH) also reports on Thursday. It closed Tuesday just above a buying area of $43.02 but volume hasn't come into the stock yet.

It's been a busy week so far of housing data. Earlier this week, December pending-home sales fell 4.3%, but the decline had more to do with tight supply rather than slack demand.

On Tuesday, the S&P/Case Shiller composite index of 20 metropolitan areas rose 0.6% in November, mostly in-line with estimates. Prices rose 5.5% from a year ago -- the 10th straight month where prices have increased -- but prices are still about 30% below a bubble peak in 2006.

Upcoming builder earnings
Three more builders will be out with earnings Thursday before the open:

• MDC Holdings: Analysts expect earnings per share of $0.40, reversing a year-ago loss, and a 49% sales growth to $367.6 million.
• PulteGroup: Analysts expect earnings per share soared 675% to $0.31, and sales growth of 19% to $1.5 billion.
• Meritage Homes: Analysts expect earnings per share of $0.42, reversing a year-ago loss, and sales growth of 45% to $355.4 million.

Stock chart: