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What: Shares of California homebuilder Standard Pacific
So what: It's been an inhospitable environment for homebuilders, but as the economy inches forward, the fortunes of U.S. homebuilders have also improved. For the fourth quarter of 2011, Standard Pacific saw its bottom line finish with a $15.3 million profit, much better than the $21.9 million loss of the year before. On a per-share basis, the profit was $0.04, which was above the $0.02 that Wall Street analysts were looking for.
On the top line, results were also better than expected. Year-over-year revenue growth was 38%, bringing the total to $293 million and easily beating the $275 million that analysts were estimating.
Now what: If you want to know what's next for Standard Pacific, look to the economy. Sure, the company has to manage its balance sheet well to stay afloat and it needs to build houses that buyers will be attracted to. But the industry as a whole, and Standard Pacific specifically, needs the economy to continue to improve in order to see current housing inventories bought up, which would tip the supply/demand balance more in homebuilders' favor.
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Fool contributor Matt Koppenheffer has no financial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter, @KoppTheFool, or on Facebook. The Fool's disclosure policy prefers dividends over a sharp stick in the eye.