BloggingStocks

Cramer on BloggingStocks: Horton doesn't get it

Jim Cramer — 2008-08-06T09:09:00+00:00

Filed under: Market matters, Centex Corp (CTX), D.R.Horton (DHI), Freep't McMoRan Copper (FCX), Stocks to Buy, Stocks to Sell, Housing, Cramer on BloggingStocks

TheStreet.com's Jim Cramer says they should be punished for trying an end run on taxpayers.

Love Centex (NYSE: CTX) (Cramer's Take), sell Horton (NYSE: DHI) (Cramer's Take)? That's how I feel after reading Horton's pathetic plea to bring back down-payment assistance for this industry, which remains unpunished for all it did to foment the housing crisis.

Yesterday, in one of our "Wall Street Confidential" series, I opined that Centex was shaping up to be one of the better builders after making so many right moves in the last year to preserve capital. I didn't care for industry leader D.R. Horton, though.

And that was before I read the outrageous comments from Horton CEO Don Tomnitz in Market Watch yesterday, where he decried that the new housing law didn't include more down-payment assistance loans from the FHA. These seller assistance loans plied basically, by the homebuilders that allow homebuyers to use a back door to FHA loans, have been defaulting at very high rates. The Congress, in an actual dollop of wisdom, scrapped them and instead gave people a tax credit of $7,500 to buy a new house, not bad considering that houses have retreated in value to the point that even though you need to put down more money as a percentage basis, as an absolute basis there's some affordability. This kind of loan is precisely what got us in trouble, an affordable loan that people ultimately couldn't afford that just helped Horton dump properties.

Centex, on the other hand, a more conservative company than Horton, and hence a more likely survivor, agrees that this kind of financing is bad in the long run because it is being given to unqualified people who then can't pay.

As we probe and (I believe) hold the bottom for the financials reached July 15, the congressional legislation is a key aspect of the returning to sanity in the housing market. But sanity includes some punishment for those who didn't play by the rules, meaning those who abetted the process of giving loans to people to get homes off the books and then hooking in the taxpayer, through the FHA, to do so. We need some homebuilders to merge or go out of business to continue to shrink the new supply to get price stability.

Horton's outrageous comments show we aren't there yet. Still too many companies in that industry depending upon you and me to stay in business, not their own business smarts and balance sheets.

The shame from this industry's participants and their unwillingness to admit that they had anything to do with the problems is just outrageous.

It's good that the legislation gave them no handouts despite ample attempts from them to get them.

Maybe there's hope for the consolidation and bankruptcies and rationalities after all, because only a desperate company would still call for such insanely imprudent plans like down-payment assistance.

Random musings: Yesterday I wrote that Freeport-McMoRan (NYSE: FCX) (Cramer's Take) was being destroyed by quant funds and the idea that it could lose 25% in a week was unfathomable. Today, Lonmin gets a bid from Xstrata, a reminder that mineral companies may have no value when it comes to the quants but tremendous value when it comes to companies that have to deliver ore to real customers who are not watching the S&P 500 futures and the stop losses and the 200-day charts.

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RELATED LINKS:
D.R. Horton Narrows Loss, but Clearly Weak
U.S. Housing Prices: When's the Bottom?
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Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer was long Freeport-McMoRan.

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Falling oil prices are not as good as you think, Danger of using credit cards at the pump & fastest dying cities in U.S. - Today in Money 8/5

Allan Halprin — 2008-08-05T09:08:00+00:00

Filed under: Starbucks (SBUX), Money and Finance Today, Archer-Daniels-Midland (ADM), D.R.Horton (DHI), Procter and Gamble (PG)

In the News:

· Procter & Gamble Earnings Top Estimates on Price Increases & Cost Controls

· Oil Prices Fall Below $120/Barrel, Hit 3-Month Low

· Cablevision Explores Spinoff, Other Measures to Boost Shareholder Value

· D.R. Horton Posts Loss, Says Market 'Still Challenging'

· Archer Daniels Midland Profit Down 61%

· Starbucks to Offer Morning Customers $2 Iced Beverages After 2pm Starting Today

· Will Airfare Hikes Ground Middle Class Fliers?

· IKEA Launches Cell Phone Service

Falling Oil Prices May Not Be as Good as You Think
Oil prices are falling sharply, and that's good news. But not nearly as good as you might think. Lower prices mean less pain at the pump - but tougher times ahead for the economy. Falling oil prices suggest that the recession the U.S. has so far avoided is well on its way, as consumers pull back from the spending spree that drove economic growth earlier this decade. A weakening economy will mean more layoffs, further pressuring already reduced spending.
Lower oil prices: a mixed blessing - FORTUNE

What Now for Bennigan's Franchisees?
What happens to franchisees when a franchisor goes bankrupt? Bennigan's owners are about to find out.
The pub-themed casual dining chain filed a Chapter 7 bankruptcy on July 29, meaning it chose to cease operations and liquidate its assets rather than attempt to reorganize under Chapter 11. Bennigan's closed all company-owned locations and announced plans to sell off the assets. The remaining 138 franchisees are still operating, but they face a tough road ahead.
After a Franchisor Files for Bankruptcy - BusinessWeek
In Photos: 11 Big Brands That Went Bankrupt & What Handppened Next to Franchisees

Be Very Careful With Your Credit Card at the Pump
Customers and police agencies across the USA are dealing with another pain at the pump -- thieves who install hard-to-detect electronic devices at stations to steal credit and debit card data. The skimmed data are used to create cards used at the victims' expense.
Thieves skim credit card data at fuel pumps - USATODAY.com

Fastest-Dying Cities in America
Despite a decade of national prosperity, the former manufacturing backbone of the U.S. is in rougher shape than ever, still searching for some way to replace its long-stilled smokestacks. Where's it worst? Ohio, which racked up four of the 10 cities on our list: Youngstown, Canton, Dayton and Cleveland. The runner-up is Michigan, with two cities--Detroit and Flint--making the ranking.
America's Fastest-Dying Cities - Forbes.com

Keeping Afloat in a Sea of Debt
When you're swimming in a sea of debt, you're constantly looking for a lifeline. This is the time to keep a cool head and make sure that whatever you latch on to will buoy you to safety and not tie you down with dead weight.
Borrowing options that offer a lifeline -Bankrate.com

How Did You Sleep Last Night?
Not so well, according to half of those we asked in a sweeping survey of the nation's sleeping habits. Consumer Reports tells you what you can do.
Why We Can't Sleep & What to Do About It - Consumer Reports

9 Myths About Sleep
Getting one hour of sleep less a night won't affect you. You need less sleep as you age. The main cause of insomnia is worry. Children who don't sleep enough will show signs of sleepiness during the day. Snoring is normal. Naps are a waste of time. These are all myths. Learn the real truth.
Read and find out the the truth behind nine common sleep myths

Does PedEgg Smooth Rough Feet?
Crack open a PedEgg. It was easy to use, very good at removing calluses, and good at removing dry skin. It did better overall than the pumice stone, and buffing pads smoothed leftover roughness. But some filings escaped, so use PedEgg over a wastebasket.
PedEgg foot file claim check

Neighbor Wars: Keeping the Peace
Just about anything can spark a border war. Consider the California man who decided to sue his neighbors because their towering redwoods blocked the sunlight from his solar panels. But the following five situations encompass the most likely flash points between neighbors. Here's how to handle them should you find yourself engaged in a neighbor war.
ConsumerReports.org - Neighbor wars: Keeping the peace

Hollywood's Top-Paid Tweens
Ten kids, one year, $107 million. Not bad. Miley, Jonas Brothers, Daniel, Hilary and more.
Hollywood's Top-Paid Tweens - Forbes.com

The Most Expensive Celebrity Baby Photos
Brangelina's latest photos reportedly went for a whooping $14 million. See who else tops our list.
The Most Expensive Celebrity Baby Photos - Forbes.com

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Cramer on BloggingStocks: The breadth of the danger is staggering

Jim Cramer — 2008-07-15T08:56:00+00:00

Filed under: Bad news, Industry, Ford Motor (F), General Motors (GM), Market matters, Citigroup Inc. (C), Advanced Micro Dev (AMD), Regions Financial (RF), AutoNation Inc (AN), Bank of America (BAC), BB and T (BBT), Merrill Lynch (MER), Sears Holdings (SHLD), Federal Natl Mtge (FNM), Comerica Inc (CMA), D.R.Horton (DHI), Amer Intl Group (AIG), Lennar Corp'A' (LEN), Southwest Airlines (LUV), Wachovia Corp (WB), Washington Mutual (WM), IndyMac Bancorp (IMB), Lehman Br Holdings (LEH), Cramer on BloggingStocks, MBIA Inc (MBI)

TheStreet.com's Jim Cramer says our problems are so widespread, he sees lots more IndyMacs before we're out.

You don't need me to tell you it's awful out there. You don't need me to tell you that there's no quick fix for any of these things. But what might help you understand why it feels so bad this time is that I have never, in my career, seen so many companies go off track at the same time. This is one unbelievable moment, and it is made more horrible by the day as companies' stocks just get pummeled, causing people to then question the very viability of the companies involved.

First, obviously, are Fannie Mae (NYSE: FNM) (Cramer's Take) and Freddie Mac (NYSE: FRE) (Cramer's Take). We don't know what will happen, but we do know that their futures are much darker than their pasts. Their best hope: a Democrat becomes president and shows the usual love to both. But as investments, they are pretty much perma-losers going forward. The losses are that heavy. Yes, it is true that two years from now they will be better, but will the government let them limp through to that? View them as calls on a Democratic win.

We all know that Citigroup (NYSE: C) (Cramer's Take), Wachovia (NYSE: WB) (Cramer's Take), Washington Mutual (NYSE: WM) (Cramer's Take) and National City (NYSE: NCC) (Cramer's Take) are in trouble. Bank of America (NYSE: BAC) (Cramer's Take) says it isn't in trouble, but obviously the market doesn't believe management because the stock failed to rally when it said its dividend was safe. Any short-selling hedge fund could hire 30 actors and have them line up at a Washington Mutual or two and get a bank run going. Then we would have to hear about a "hasty" Treasury department plan to bail out WM. Hasty? How can these guys not see it coming?

No revelation that Lehman (NYSE: LEH) (Cramer's Take) or Merrill's (NYSE: MER) (Cramer's Take) in the soup, although I do marvel that at no price do they seem interesting to anyone -- value guys, takeover guys, or acquirers in general. But how about Comerica (NYSE: CMA) (Cramer's Take), Regions Financial (NYSE: RF) (Cramer's Take), Sovereign (NYSE: SOV) (Cramer's Take), Huntington Bancshares (NASDAQ: HBAN) (Cramer's Take), Suntrust (NYSE: STI) (Cramer's Take), Fifth Third (NASDAQ: FITB) (Cramer's Take), First Horizon (NYSE: FHN) (Cramer's Take), Marshall & Ilsley (NYSE: MI) (Cramer's Take), Zions (NASDAQ: ZION) (Cramer's Take), Key (NYSE: KEY) (Cramer's Take), Colonial (NYSE: CNB) (Cramer's Take) and BB&T (NYSE: BBT) (Cramer's Take)? Their charts are indicating there is much more devastation ahead. Every one of them is small enough to fail, and no one would give a darn. If the FDIC follows the trail blazed by IndyMac (NYSE: IMB) (Cramer's Take) it would be great because IndyMac Federal isn't foreclosing anymore. Get rid of the foreclosures, get rid of some of the overhang. But is that the plan, or do they have no place to put the foreclosed loans?

We know that the Gang of Four -- MBIA (NYSE: MBI) (Cramer's Take), MGIC (NYSE: MTG) (Cramer's Take), PMI (NYSE: PMI) (Cramer's Take) and Ambac (NYSE: ABK) (Cramer's Take) -- has been obliterated, a long-running saga of puffing by management and disastrous numbers. These companies are important, even if everyone seems to think that they have gone down without much repercussion other than the 40th story about how private mortgage insurers are now raising rates. Golly gee, who is paying them anything? They don't have enough money to pay the bank back for heaven's sake!

For example, they are very important to AIG (NYSE: AIG) (Cramer's Take), which seems to have found no bottom. None at all. Remember that funny dividend boost at AIG? What was that about?

There are tons of other financial insurers no one's paying attention to that seem to go down pretty constantly. An outfit like XL (NYSE: XL) (Cramer's Take) seems like it is a wasting asset. Or how about Genworth (NYSE: GNW) (Cramer's Take), which is selling well below book value?

Then there is everything auto, not just Ford (NYSE: F) (Cramer's Take) and GM (NYSE: GM) (Cramer's Take) (although do you really need anything else to go wrong there?) -- outfits like Visteon (NYSE: VC) (Cramer's Take) or Autonation (NYSE: AN) (Cramer's Take) or Carmax (NYSE: KMX) (Cramer's Take) aren't going to get through this one unscathed.

Or how about the homebuilders? Does anyone think that Hovnanian (NYSE: HOV) (Cramer's Take), Lennar (NYSE: LEN) (Cramer's Take), Pulte (NYSE: PHM) (Cramer's Take) and Horton (NYSE: DHI) (Cramer's Take) will all make it? I don't. How about that nifty Lennar upgrade by UBS? Sold to you, UBS (NYSE: UBS) (Cramer's Take), along with all of the toxic mortgages you STILL OWN!

I am not even going to include the airlines, they are all hopeless in my opinion, except for maybe Southwest (NYSE: LUV) (Cramer's Take). They are charities.

Other areas have problems -- retail has some busted stocks, and so do restaurants. Chico's (NYSE: CHS) (Cramer's Take)? Charming Shoppes (NASDAQ: CHRS) (Cramer's Take)? How about Macy's (NYSE: M) (Cramer's Take) -- where's that headed? Sears (NASDAQ: SHLD) (Cramer's Take)? OUCH!

You can see some techs folding, but only a handful. Maybe because only AMD (NYSE: AMD) (Cramer's Take) is on the fiscal ropes do people see "relative strength" in tech, whatever that means.

The problem is that the dire stocks, the ones I have listed, are so numerous and so concentrated with so little hope for rescue that it is hard to imagine anything but more downside for these stocks and therefore more downside for the rest of the market, simply because they are so glaring, are owned by so many mutual funds and have so many roles to play in the real economy.

We know that things have gotten out of control because the IndyMac collapse -- widely predicted -- used a huge amount of the surplus the FDIC has, suddenly making the safety net seem like a flimsy piece of Brawny.

The bottom line here -- there is too much going wrong right now, too much to put us anywhere near sound footing. I suspect that every rally will be met with selling until we see a multitude of collapses like IndyMac.

I am not going to search for positives in any of these groups yet, and if they rally off the decision by the Treasury to make more explicit the Fannie and Freddie guarantees, I would scale out of them once again on any short squeeze like the one we had at yesterday's opening.

Someone asked me yesterday, "When do we bottom?" I said it wouldn't be until all the banks that have to fail do so and GM files bankruptcy along with Ford. I said it matter-of-factly, because I meant it and because it is obvious.

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RELATED LINKS:
IndyMac Insurance Tab Could Hit $8B
Fannie, Freddie Plan Staves Off Housing Disaster
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Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer had no positions in the stocks mentioned.

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Cramer on BloggingStocks: Deep in the heart of defaults

Jim Cramer — 2008-05-30T09:00:00+00:00

Filed under: Market matters, Countrywide Financial (CFC), D.R.Horton (DHI), KB HOME (KBH), Lennar Corp'A' (LEN), Toll Brothers (TOL), Housing, Recession, MBIA Inc (MBI)

TheStreet.com's Jim Cramer says the mortgage problem is in the process of cresting, which is why the stocks have largely bottomed.

We are in the heart of default country, and we knew we would be. This is the toughest moment. You need to go back and look at the calendar to realize the astonishing acceleration in defaults. It's simple: This moment two years ago is when the underwriting standards were the lowest, and this is the moment when the defaults will be the highest because the loans are resetting at high levels and most of the lenders, lenders like Countrywide (NYSE: CFC) (Cramer's Take), are more interested in getting as much out of a borrower as possible before kicking him out than working out the loan.

Think about it.

In the second quarter of 2006, the housing industry was going strong. We were in the 7-million-homes-changing-hands mode, and the vast majority of those homes required little money down, with home equity loans being taken out immediately to pay whatever little interest was being charged. These were the moments of the ultimate no-doc-high-fee loans by New Century Financial, Ameriquest, Resmed (Ditech), American Home Mortgage, Novastar, and of course, Countrywide. This was when the homebuilders' mortgage arms lent the most terribly.

This was also the height of packaging, where the loans were shipped off quickly to who knows where. These were the homes that were being priced at 120% of value when you tacked on home equity loans, which a huge number of borrowers did.

In short, from now until the end of the year, almost everyone who bought in 2006 is underwater, and it is only the need to preserve credit and the American dream that is keeping people in these homes.

That's why I have been saying 17 months from now -- it was 18, we get closer! -- we will be through this problem. I am picking 17 months because these bad loans reached their height during this period and went on until the end of the year, and I figure those who are going to default will do so within this period.

After 2006, the underwriting standards tightened dramatically, although there were still some homes underwritten by that nasty gang of ne'er-do-wells, but that lasted about two months. That's another reason why the problem will go on through 2009 -- those deals need two years, too.

After that, here is what will happen. The remaining people will find a way to make ends meet and the homebuilders, the Tolls (NYSE: TOL) (Cramer's Take) and Lennars (NYSE: LEN) (Cramer's Take) and Hovnanians (NYSE: HOV) (Cramer's Take) and KB Homes (NYSE: KBH) (Cramer's Take), the Pultes (NYSE: PHM) (Cramer's Take) and DR Hortons (NYSE: DHI) (Cramer's Take), will have gone through their whole spec inventories and the new-home inventories will be smaller. The household formation numbers and the lower price of homes will force more buys to be made.

And we will be out of this jam. The important thing to remember is that there should be no surprises that this is occurring right now. That's the 2-and-20-plus HELOC talking, and anyone who didn't think it would happen this way is all wrong.

It is why I was ranting for the Fed to cut rates hard back then, so the two and 28 when they rolled over would not be the disaster that they turned out to be. You couldn't refinance at those higher short-term rates. It is why the FHA was a must to get involved, because otherwise it was all voluntary, and despite what you hear, the mortgage servicers would do better if they harass and harass and harass rather than work with the borrowers. The mortgage companies need to get something out of them. It is why the CDOs were doomed from the period. It is why outfits like Ambac (NYSE: ABK) (Cramer's Take) and MBIA (NYSE: MBI) (Cramer's Take) were walking dead men as they insured those CDOs and why PMI (NYSE: PMI) (Cramer's Take) and MGIC (NYSE: MTG) (Cramer's Take) will struggle to stay alive -- these companies insured the individual loans. It is why the regional bank holders of HELOC will most likely not make it.

It is why everything bad is happening now.

What people don't realize is that things are going to crest in five months, the peak of two years of madness, and we have to be thinking that things are going to get better, not worse. It is why the homebuilders stopped going down. They are discounting the scenario I just outlined.

If we get congressional relief and help from the FHA, then 17 months will be too long and the turn should be within a year, because the foreclosures would die down dramatically.

Already the mortgage servicer reports, just released for April, are showing some improvement. That's people digging in their heels from 2005 and the first part of 2006. It is why, as some would say, the pig is moving through the python.

Cause for optimism? No. Cause for realism and why the stocks have not taken out their lows.

Next week Toll and Hovnanian report. They will not be able to say we are over the hump yet.

But if they don't acknowledge the hope, they will be just as wrong as they were in the height of 2006, when they were all playing the game.

RELATED LINKS:

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer had no positions in the stocks mentioned.

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Before the bell: DHI, LDK, VOD, AAPL, FNM, TGT ...

Melly Alazraki — 2008-05-06T08:20:00+00:00

Filed under: Before the bell, Earnings reports, Apple Inc (AAPL), Target Corp. (TGT), JPMorgan Chase (JPM), Federal Natl Mtge (FNM), D.R.Horton (DHI), Teva Pharm Indus ADR (TEVA)

Before the bell: With high oil prices, FNM on deck, futures decline

D. R. Horton (NYSE: DHI) shares are down over 6% in premarket trading after the homebuilder has swung to a loss for its fiscal second quarter of $1.31 billion, or $4.14 per share. With the continued housing slump, the company took hefty charges to write down the value of its inventory. Revenue plunged to $1.62 billion from $2.62 billion a year ago.

Fannie Mae (NYSE: FNM) shares are slumping over 9% this morning after the mortgage lender said it lost $2.2 billion or $2.57 a share in the first quarter due to mounting home-loan delinquencies as the housing slump continued. The results were below, far below that of estimates.

Vodafone Group (NYSE: VOD) said Tuesday that it's signed an agreement with Apple Inc. (NASDAQ: AAPL) to sell the iPhone in ten of its markets including Australia, the Czech Republic, Italy and India.

LDK Solar Co. (NYSE: LDK) shares climbed nearly 2% in after-hours trading after the solar energy company said that it has signed a five-year agreement to supply multicrystalline solar wafers to German chip maker Qimonda AG.

JPMorgan Chase & Co. (NYSE: JPM) said Monday it will buy an undivided stake in Target Corp. (NYSE: TGT)'s credit card receivables for $3.6 billion in cash. TGT shares are up over 1% in premarket trading, JPM's down over 1%.

Teva Pharmaceutical Industries Inc. (NASDAQ: TEVA) shares are also declining 1% this morning after the drugmaker reported first-quarter net income fell 57% due to a charge. As if to show the differences between generic pharmas, adjusted profit actually rose 55% and revenue grew 24% to $2.57 billion. Excluding the charge, earnings were 64 cents a share versus 42 cents.

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Pre-market movers (DHI) (UBS)

Douglas McIntyre — 2008-05-06T07:55:00+00:00

Filed under: Before the bell, D.R.Horton (DHI), Anadarko Petroleum (APC)

Divx (NADSAQ:DIVX) is up15% on stronger-than-expected earnings.

Anadarko Petroleum (NYSE:APC) is up over 8% on good numbers.

DH Horton (NYSE:DHI) is down 6% due to a quarterly loss.

UBS (NYSE:UBS) is down over 2% after announcing lay-offs of 5,500 bankers.

Stocks may trade differently in the pre-market than they do in the regular session.

Douglas A. Mcntyre is an editor at 247wallst.com and author of the Ten Stocks Under $10 letter.

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Analyst upgrades: YHOO, CI, DHI, HTZ and ERTS

Eric Buscemi — 2008-03-25T11:22:00+00:00

Filed under: Analyst reports, Analyst upgrades and downgrades, Microsoft (MSFT), Yahoo! (YHOO), CIGNA Corp (CI), D.R.Horton (DHI), Electronic Arts (ERTS)

MOST NOTEWORTHY: Yahoo!, Cigna and Aegean Marine were today's noteworthy upgrades:

Citigroup upgraded shares of Yahoo! (NASDAQ: YHOO) to Buy from Hold as they believe Microsoft (NASDAQ: MSFT) is unlikely to walk away from Yahoo! and that there is potential Microsoft could bid $34/share.
Credit Suisse upgraded Cigna (NYSE: CI) to Outperform from Neutral citing the company's favorable business mix.
Stephens upgraded shares of Aegean Marine (NYSE: ANW) to Overweight from Equal Weight on valuation as they see an attractive entry point at current levels.

OTHER UPGRADES:

JMP Securities raised D.R. Horton (NYSE: DHI) to Strong Buy from Outperform and Pulte Homes (NYSE: PHM) to Outperform from Market Perform.
Goldman added Hertz Global (NYSE: HTZ) and Electronic Arts (NASDAQ: ERTS) to its Conviction Buy List.

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Analyst initiations: Suntech Power, Premier Exhibitions, homebuilder sector

Eric Buscemi — 2008-02-27T11:57:00+00:00

Filed under: Analyst reports, D.R.Horton (DHI), KB HOME (KBH), Toll Brothers (TOL), Analyst initiations, Suntech Power Hldgs ADS (STP)

MOST NOTEWORTHY: Suntech Power, Premier Exhibitions and the Homebuilders Sector were today's noteworthy initiations:

Citigroup named Suntech Power Holding (NYSE: STP) their top pick for China solar due to its leading scale and technology roadmap for higher cell efficiency, initiating shares with a Buy rating and $55 target.
Merriman believes Premier Exhibitions (NASDAQ: PRXI) can move to the $14.50-$17.00 through the continued monetization of the company's current tours, the launching of additional tours and the value of the Titanic artifacts on hand. The firm started shares with a Buy rating.
Lehman initiated D.R. Horton (NYSE: DHI), Ryland Group (NYSE: RYL), Toll Brothers (NYSE: TOL) with Overweight ratings and an $18 target, $31 target and $27 target; KB Home (NYSE: KBH) with an Equal Weight rating and $24 target; and Hovnanian Enterprises (NYSE: HOV) with an Underweight rating and $8 target.

OTHER INITIATIONS:

Citigroup initiated Yingli Green Energy (NYSE: YGE) with a Hold rating and $24 target.
UBS initiated Citrix Systems (NASDAQ: CTXS) with a Neutral rating and $38 target.
JP Morgan initiated Biodel (NASDAQ: BIOD) with an Overweight rating.

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Before the bell: WMT, M, UL, DHI, GOOG, GM, MCD ...

Melly Alazraki — 2008-02-07T08:23:00+00:00

Filed under: Before the bell, Earnings reports, Rumors, Google (GOOG), Apple Inc (AAPL), Wal-Mart (WMT), General Motors (GM), McDonald's (MCD), D.R.Horton (DHI), News Corp'B' (NWS), Unilever ADR (UL)

Wal-Mart Stores Inc. (NYSE: WMT) will open its first in-store medical clinics under its own brand name, The Clinic at Wal-Mart, as a joint venture with local hospital systems in Atlanta, Dallas and Little Rock, Ark., starting in April.

Unilever (NYSE: UL) on Thursday reported a 65% drop in fourth-quarter net income to 721 million euros after selling its European frozen-food business. However, comparable sales growth showed a nice rise. Revenue at Unilever rose 2% to 9.89 billion euros and underlying sales growth was 6.1% during the quarter, with pricing contributing three percentage points to the underlying sales growth. Analysts had expected a profit of 693.5 million euros on sales of 9.95 billion euros.

D.R. Horton (NYSE: DHI) swung to a fiscal first-quarter loss of $128.8 million, or 41 cents a share, with revenue falling to $1.71 billion from $2.8 billion. The quarterly results included $245.5 million in charges. Shares are up nearly 1% in premarket trading.

TechCrunch is reporting this morning an unconfirmed rumor that either Google (NASDAQ: GOOG) or News Corp. (NYSE: NWS)'s MySpace is about to announce a big $1-1.5 billion acquisition in the social space. TechCrunch has come to a conclusion that the most likely candidate is Bebo. Again - unconfirmed rumor and Bebo is the speculation of the guys at TechCrunch.

Macy's Inc. (NYSE: M) shares are down over 1.8% in premarket trading after it announced it would be combining three regional divisions and cutting about 2,300 management jobs.

FORTUNE takes a look at how Apple Inc. (NASDAQ: AAPL) prices its products and memories. Interesting.

General Motors Corp (NYSE: GM) is planning for half its cars in the United States to be running on ethanol by 2012.

McDonald's Japan, nearly half owned by McDonald's Corp. (NYSE: MCD) posted a five-fold increase in annual net profit on Thursday and predicted further growth as it opens new stores and refreshes its menu. It forecast net profit would rise 28% in 2008 as it plans to open 130 new stores.

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Seven lessons Super Bowl XLII teaches investors

Timothy Sykes — 2008-02-04T10:30:00+00:00

Filed under: Google (GOOG), Microsoft (MSFT), Yahoo! (YHOO), Apple Inc (AAPL), General Electric (GE), D.R.Horton (DHI), Goldman Sachs Group (GS), KB HOME (KBH), Toll Brothers (TOL)

1. Expect the unexpected: Neither the Giants winning or the low 17-14 final score was expected in the least (Bull markets can't last forever, stocks DO NOT always trend higher over time)

2. Never trust "experts:" Ex-Giant and "football expert" Tiki Barber was dead wrong when he retired one season too soon while trashing his former teammates and coaches in order to get attention (Don't listen to "market experts" when they make predictions like Apple (NASDAQ: AAPL) $300 and Google (NASDAQ: GOOG) $1,000 to get attention)

3. The acknowledged best are not always the best performers: Patriots quarterback Tom Brady, the league MVP, got outplayed by oft-criticized Eli Manning (just because hugely successful companies like Microsoft (NASDAQ: MSFT), General Electric (NYSE: GE) and Goldman Sachs (NYSE: GS) are leaders in their fields does not mean their stocks will outperform lesser quality rivals)

4. Past performance is not indicative of future returns: For the season, the Patriots came in undefeated, the Giants had lost six games (Wow, this standard SEC disclaimer is actually right on the money for once!)

5. The weakest sometimes become the strongest: Little known Giants wide receiver David Tyree did more in this one game than he had all season, capping his performance off with one of the greatest catches in Super Bowl history (Hurting homebuilders like KB Home (NYSE: KBH), Toll Brothers (NYSE: TOL), D.R. Horton (NYSE: DHI) have been the best performers in the entire stock market as of late)

6. Certain rules are ridiculous: The game was already decided, spectators and press were on the field and Patriots coach Bill Belichick was already in the locker room when two seconds still remained on the game clock, but the NFL made the Giants run one more play (Lots of ridiculous stock market rules: The Pattern Day Trading Rule, hedge fund managers can't advertise or talk to the press, people in the finance industry are prohibited from reviewing financial books (as I learned with my book)

7. Eyeballs matter: This year, with estimates of 100 million people watching, a 30 second ad cost $2.7 million. (This is why horribly run businesses like Yahoo! (NASDAQ: YHOO) can get premium buyout offers)

Disclosure: Giants fan

Timothy Sykes writes the blog timothysykes.com, is a former hedge fund manager, star of the TV show Wall Street Warriors and author of the book, An American Hedge Fund: How I Made $2 Million as a Stock Operator & Created a Hedge Fund

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Cramer on BloggingStocks: The gloomy consensus bet's still right

Jim Cramer — 2008-01-09T10:05:00+00:00

Filed under: Market matters, AT and T (T), Brinker Intl (EAT), Archer-Daniels-Midland (ADM), Countrywide Financial (CFC), D.R.Horton (DHI), Family Dollar Stores (FDO), duPont(E.I.)deNemours (DD), Deere and Co (DE), Cramer on BloggingStocks, Bunge Ltd. (BG)

TheStreet.com's Jim Cramer says it's still too early to get contrarian about the universal negativity on retail.

Squeeze?

DuPont (NYSE: DD) (Cramer's Take) better than expected. Countrywide (NYSE: CFC) (Cramer's Take) puts up numbers that don't seem bankruptish. We could have a day's respite from the gloom. We certainly are owed one, at least in Nasdaq land.

Plus, when you go out with people from the trading desks, you are overwhelmed by the negativity.

Last night at a buy-side/sell-side dinner, a smart guy I know who loves the short side tried to make a case for some down-and-out airlines and retailers. He's a price guy, meaning that he believes everything has a price and that you have to start looking at a Lowe's (LOW) here or a Macy's (M) because if you start buying now, put some on, you will be getting a pretty decent risk-reward ratio.

I thought people were going to throw things at him. He was immediately ridiculed as someone who didn't understand what's out there, the collapse of consumer spending as evidenced by Brinker's (NYSE: EAT) (Cramer's Take) Chili's, AT&T (NYSE: T) (Cramer's Take), Family Dollar (NYSE: FDO) (Cramer's Take) and all of the other usual suspects Tuesday.

The lone long persisted, pointing out that Chico's (NYSE: CHS) (Cramer's Take) and Talbots (NYSE: TLB) (Cramer's Take) have come down so much. (The latter has a suspiciously high dividend for a retailer and is clearly having a hard time.) He argued that there is some brand value.

Everyone laughed.

Now, I would tell you that every company he mentioned at this dinner probably will miss numbers. We know from the action in every company that has missed numbers that there are endless sellers, people who genuinely just discovered that they were on something gone awry.

But the universal nature of the scoffing at him made me take notice.

Now, if you had said anything, word one, positive about housing for the last 18 months you have been hounded, and the hounders would have been right.

Retail has a huge housing component when it comes to spending. But the housing companies have horrible balance sheets. Do you really feel that Hovnanian (NYSE: HOV) (Cramer's Take) and Pulte (NYSE: PHM) (Cramer's Take) and D.R. Horton (NYSE: DHI) (Cramer's Take) and Beazer (NYSE: BZH) (Cramer's Take) and Standard Pacific (NYSE: SPF) (Cramer's Take) can make it? How about Countrywide, despite numbers to the contrary this morning, or E*Trade (NASDAQ: ETFC) (Cramer's Take), despite restructuring, or the Gang of Four -- MGIC (NYSE: MTG) (Cramer's Take), Ambac (NYSE: ABK) (Cramer's Take), MBIA (NYSE: MBI) (Cramer's Take) and PMI (NYSE: PMI) (Cramer's Take)?

I think that sector has been bleeding and will continue to bleed.

I am simply saying that profitable companies with good brands and decent balance sheets will survive.

And if something, anything, good happens here, you won't be able to get anywhere near these prices.

Of course, the issue is with gold and platinum and corn at all-time highs, with the Fed intransigent, with oil skyrocketing still, what could possibly be good?

Nothing's gotten better in the macro picture, it has only gotten worse.

One day that will change. But until then, the consensus looks like the right bet.

Random musings: The only game in town, agriculture, strikes again with a big quarter from Mosaic (NYSE: MOS) (Cramer's Take). REIT BUY: BG (NYSE: BG) (Cramer's Take), MOS, AGU (NYSE: AGU) (Cramer's Take), MON (NYSE: MON) (Cramer's Take), DE (NYSE: DE) (Cramer's Take), ADM (NYSE: ADM) (Cramer's Take).

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Please note that due to factors including low market capitalization and/or insufficient public float, we consider Hovnanian, Beazer and Standard Pacific to be small-cap stocks. You should be aware that such stocks are subject to more risk than stocks of larger companies, including greater volatility, lower liquidity and less publicly available information, and that postings such as this one can have an effect on their stock prices. At the time of publication, Cramer had no positions in any of the stocks mentioned in this post.
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Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO.

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When will the homebuilders' misery end?

Jonathan Berr — 2007-12-19T15:14:00+00:00

Filed under: Bad news, Products and services, D.R.Horton (DHI), Toll Brothers (TOL), Housing, Federal Reserve

For homebuilders like Hovnanian Enterprises Inc. (NYSE: HOV), Toll Brothers Inc. (NYSE: TOL) and D.R. Horton Inc. (NYSE: DHI), 2007 was a year to forget, and 2008 probably isn't going to be that great either.

For Hovnanian, which today reported a fourfold increase in its fourth-quarter loss, times are going to be especially hard. The New Jersey company is selling off property at a furious pace, reducing its total land position by 47%, and will cut it further next year, according to Chief Financial Officer J. Larry Sorsby. During the fourth quarter, land sales rose to $64.15 million compared with $41.3 million a year earlier. Homebuilding revenue fell to $1.3 billion. Obviously, that's a not a situation that's sustainable for a company whose business is selling homes, not selling land. Shares of Hovnanian are down $2.09, or 24%, at last check to $6.45.

Believe it or not, Hovnanian was pleased with the results. Chief Executive Ara K. Hovnanian said in the press release that the company exceeded its projections and paid down more of its debts than it projected. Moreover, the company's banks gave it a waiver for covenants under its $1.5 billion revolving credit facility. Hovnanian, though, is seeking seeking additional waivers. Again, not a good sign.

"While the factors that created this downturn are different than any other throughout our 48-year history, we know that stronger demand for new homes will return," he said. "What is not known is how long the market will take to rebound."

Another issue, of course, is whether the company's banks and investors are going to stick around long enough for this to happen, since new home sales probably aren't going to rebound significantly for a while, since supplies of existing homes at rock-bottom prices are plentiful.

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DR Horton (DHI) surges on government mortgage help

Brent Archer — 2007-11-30T11:36:00+00:00

Filed under: Major movement, Good news, Industry, D.R.Horton (DHI), Options, Technical Analysis, Economic data, Housing

DR Horton Inc. (NYSE: DHI) shares are rising this morning on news that the Bush administration is working behind the scenes with the home-lending industry on a plan to extend lower, introductory interest rates on home loans. Treasury Secretary Henry Paulson with loan servicing companies and other industry executives yesterday to come up with a loan modification plan in the wake of the subprime crisis. No formal agreement was announced, but an agreement could be be revealed in the next week or two. Also helping the situation are comments from Fed Chairman Ben Bernanke, who hinted at further rate cuts in December. If you think that the company won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on DHI.

After hitting a one-year high of $31.13 in February, the stock hit a one-year low of $10.15 on Tuesday. DHI opened this morning at $10.78. So far today the stock has hit a low of $10.77 and a high of $11.99. As of 10:55, DHI is trading at $11.97, up $1.50 (14.3%). The chart for DHI looks neutral and steady, while S&P gives the stock a positive 4 STARS (out of 5) buy rating.

For a bullish hedged play on this stock, I would consider a May bull-put credit spread below the $7.50 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 13.6% return in just 5 months as long as DHI is above $7.50 at May expiration. DR Horton would have to fall by more than 37% before we would start to lose money.

DHI hasn't been below $10 at all in the past year and has shown support around $10.50 recently. This trade could be risky if potential rate cuts don't help the homebuilders too much, but the recent reactions from the market indicate otherwise.

Brent Archer is an options analyst and writer at Investors Observer. At publication time, Brent neither owns nor controls positions in DHI.

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Before the bell: PHM, BP, DELL, SIRI, AAPL ...

Melly Alazraki — 2007-11-27T08:40:00+00:00

Filed under: Before the bell, Analyst reports, Analyst upgrades and downgrades, Apple Inc (AAPL), Dell (DELL), Sirius Satellite Radio (SIRI), Centex Corp (CTX), Chevron Corp (CVX), D.R.Horton (DHI), KB HOME (KBH), Lennar Corp'A' (LEN), BP p.l.c. ADS (BP), Toll Brothers (TOL), Analyst initiations

Before the bell: Futures higher after $7.5 billion investment in Citigroup

TheStreet.com has a great piece comparing Apple Inc.'s (NASDAQ: AAPL) iPhone with other alternatives in the market. While mostly the iPhone is found to be the most intuitive, the one minus is the email it seems. Also, Fortune has a piece on the power of Apple's founder and CEO, Steve Jobs. In premarket trading, Apple shares reached $175 -- have you read Georges Yared's post and bought before?

Dell Inc. (NASDAQ: DELL) chose retailer Carrefour Group to be the first European mass merchandiser to sell Dell notebook and desktop computers in its 365 stores in France, Belgium and Spain beginning in January.

Sirius Satellite Radio Inc. (NASDAQ: SIRI) said that Ford Motor Co. (NYSE: F) may have its satellite radio services in approximately 70% of Ford and Mercury 2009 vehicles next year.

Notable calls: BP (NYSE: BP), Chevron (NYSE: CVX) and Marathon Oil (NYSE: MRO) were upgraded by Bear Stearns after the broker lifted its oil forecast for 2008 from $60 to $75 a barrel. BP and CVX were upgraded to outperform from peer perform and MRO to peer perform from underperform. BP shares are up 1% in premarket trading, CVX down 0.1%.

Soleil Securities Group began coverage of several homebuilders with a cautious industry outlook. KB Home (NYSE: KBH) was started with Hold and a $25 target, D.R. Horton (NYSE: DHI) also got a Hold and a $13 target price. Lennar (NYSE: LEN) and Centex (NYSE: CTX) were started with a Buy and a $20 target for LEN. Toll Brothers (NYSE: TOL) was also started with a Buy. Pulte Homes (NYSE: PHM) was started with a Hold and an $11 target price just as Pulte reaffirmed its fourth-quarter profit outlook, but warned that demand for new housing is weak and supply is high. PHM shares are up 5.35% in premarket trading.

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Top short-squeeze stocks, 10 investing ideas for 2008 & new credit card loyalty plans - Today in Money 11/20

Allan Halprin — 2007-11-20T08:47:00+00:00

Filed under: Hewlett-Packard (HPQ), Money and Finance Today, D.R.Horton (DHI), NIKE, Inc'B' (NKE), Nordstrom, Inc (JWN), Jones Apparel Group (JNY)

In the News:

· Dow Passes 13,000 As It Heads Further Down

· Bad Loans Sink Freddie Mac, Company Posts $2 Billion Loss & Dividend at Risk

· Hewlett-Packard Earnings Rise, Tops Estimates

· New Home Construction Unexpectedly Rises

· Wealthy Gulf Nations Rethink Peg to Dollar

· Homebuilder D.R. Horton Swings to Q4 Loss

· Sony BMG, Yahoo Ink Online Video Deal

· Nordstrom Earnings Top Estimates

· Complaints Against Airport Security Surge

· TV Sellers Are Thinking Big

Top Short-Squeeze Stocks

These heavily shorted stocks could surge on any good news. They include Jones Apparel, Quest Diagnostics, Hansen Medical, Nike, Unisys, Andrew Corp.

Top S&P 500 Short-Squeeze Stocks

10 Investing Idea's for 2008

Here is how to upgrade your portfolio, reduce risk and ride new investment waves.

Ten investing ideas for the next 12 months - MarketWatch

How to Get the Hot Holiday Toys for Less

Even after all the recalls there are a slew of toys that are going to be hot sellers this year. See what toys the are and where you can get them for less money.

Where to Find the Best Bets on the Hottest Holiday Toys SmartMoney.com

Credit Card Push: New Loyalty Plans

Credit-card issuers are trying a new tack to build loyalty among cardholders who know they can maximize benefits by using one at the grocery store and another at the gasoline pump. The plan: more flexibility and payment choices.

Credit Cards Push New Loyalty Plans - WSJ.com

See New Offerings

17 Reasons the U.S. Needs a Recession

Yes, America needs a recession. Bernanke and Paulson won't admit it. And investors hate them. We're all trapped in outdated 1990s wishful thinking about a "new economy" and "perpetual growth."

Seventeen reasons America actually needs a recession - MarketWatch

Young, Fabulous & Incredibly Rich

It used to be heiresses just lunched, shopped and partied. Don't tell the $20 billion babies on Forbes' list of the 20 Most Intriguing Billionaire Heiresses, who defy the stereotype of the bon-bon popping princess thanks to achievements in business, sports and the arts.

The 20 Most Intriguing Billionaire Heiresses - Forbes.com

Lust But Don't Touch

Want an Armani cell phone? Nokia's very cool 8800 Sirocco? Well fughedaboutit. These are among hot cell phones that you cant get in the U.S. See other phones you can't here and see why the mobile phone you want exists somewhere other than the

Dogfish Head: Brewing Up Relationships

The beermaker employs an off-center approach to everything, including its flavors, grassroots marketing, and wacky promotions.

Dogfish Head: Brewing Up Relationships

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