Monday, August 06, 2007

Number Of The Day ....Earnings Estimates for Homebuilders

I think everybody knows my opinion regarding "Wall Street Finest" as Jeff Matthews would have said. The incompetence from the analysts is the reason i mainly have stopped listening to conference calls from builders, lenders etc.

How many times i have heard the same calls and couldn´t believe the comments or upgrades that came from people that have heard the same. That's´s on top of the fact that everybody should have known that the industry would face some "serious" headwinds for the next decade .....

I have learned that is always better to use common sense

Meine Meinung hinsichtlich der Analysten dürfte inzwischen bekannt sein. Die Inkompetenz dieser Meinungsmacher ist einer der Hauptgründe warum ich inzwischen größtenteils aufgehört habe mir noch Telefonkonferenzen anzutun.

Ich kann mich kaum noch daran erinnern wie oft ich denselben Call gehört habe und mir danach verwundert die Augen gerieben habe wenn ich den Analystenkommentar oder eine Heraufstufung gesehen habe. Dabei konnte ein "Blinder mit dem Krückstock" seit 18-24 Monaten erkennen das über dem US Immobilienmarkt ein Orkan von historischen Ausmaßen hereinbrechen würde

Ich habe festgestellt das der gesunde Menschenverstand den sogenannten Expertenmeinungen immer vorzuziehen ist.

This number is taken from the good cover story of Business Week "Bonfire Of The Builders"
Now the bust is taking a brutal toll. In January, industry analysts predicted that the 10 biggest builders would have average earnings per share of $3.69 for 2007; the latest forecast is for a loss of $1.18.
Too bad that nobody can short a certain Anaylst. I would have a great collection of the potential shorts..... :-)

Zu blöd das man nicht einzelne Analysten shorten kann. Ich hätte auf Schlag ne ganze Palette guter Shortkandidaten.... :-)
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Anonymous Anonymous said...

Here's a comment I left on a YHOO message board for one of the HB stocks:

Yes, 'analysis' coming from Wall St can also be unintentionally funny, not to mention hazardous to your financial health. Via my brokerage acct I have access to such Wall St research, and re CFC on May 7 one company had this to say (closing price on May 7 for CFC = 38.51):

"...We are reducing our 2007 EPS forecast from $4.55 to $3.85, which is in line with consensus and represents an 11% decline. We are lowering our 2008 forecast from $5.35 to $4.70, about 22% above our 2007 forecast and about $0.10 ahead of the consensus...We are maintaining our BUY rating on CFC with a 12-month target price of $50."

So at that time current price was 38.51, target 50.

Then on July 26, when CFC was selling for 29.25 (oops, wrong direction), they say this:

"We are maintaining our BUY rating on Countrywide Financial Corp. (NYSE: CFC) but reducing our 12-month target price to $35 from $50. We are lowering our 2007 and 2008 EPS estimates and our long-term growth rate forecast as well. The housing and mortgage debt markets just keep getting tougher..."

Yeah, times are also tough for people who follow this outfit's investment advice.

Note that CFC closed on Friday Aug 3 @ 25.


5:55 AM  
Blogger jmf said...

Moin Eh,

good example.

This guy
should have already lost his job...

But at Wall Street you never know :-)

6:13 AM  

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