We really don't even hear or see the numbers being released these days by the nation's major homebuilders as much as we hold a stethoscope to the CEOs' hearts in the hopes that we'll get a better sense of where housing's bottom may be lurking.
Case in point: On Friday, Hovnanian
Without those charges, the company earned $26.7 million pretax, or $0.20 per share. But that's really a less meaningful number than the net loss of $57.3 million, or $0.91 per diluted share, that the company reported for the quarter. For a comparison to the year-ago quarter, just assume that it's a case of this year's loss versus solid earnings last year.
But as with such other builders as Centex
In contrast, Hovnanian President and CEO Ara Hovnanian was more measured in his assessment of the market: "Once the housing market bottoms out, we are not expecting a rapid recovery. Instead, we expect sales to hold at a steady pace for several quarters. In he current environment, our contract pace is difficult to predict, and it will likely vary based on individual market and community characteristics."
In reality, the comments from Tomnitz and Hovnanian probably weren't that far removed one from the other. The truth is that nobody really knows when the housing market will bottom out and head for higher ground -- or whether it may have already done so. Indeed, the "housing market" is actually composed of dozens of individual markets in the U.S., and they will probably recover at different rates.
But ultimately, they will all recover. As such, I continue to believe that Fools for whom there is little magic in a one-year investment time horizon might want to slowly build positions in such homebuilders as the luxury member of the group, Toll, along with well-managed nationwide builders Centex and Ryland
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Fool contributor David Lee Smith does own shares of Centex but has no ownership in the other companies mentioned. He welcomes your comments or questions.