The Zacks Analyst Blog Highlights:D.R. Horton, Berkshire Hathaway, Masco, USG
and PPG Industries
CHICAGO, Jan. 2, 2013
CHICAGO, Jan. 2, 2013 /PRNewswire/ --Zacks.com announces the list of stocks
featured in the Analyst Blog. Every day the Zacks Equity Research analysts
discuss the latest news and events impacting stocks and the financial markets.
Stocks recently featured in the blog include D.R. Horton Inc. (NYSE:DHI),
Berkshire Hathaway Inc. (NYSE:BRK.B), Masco Corp. (NYSE:MAS), USG Corp.
(NYSE:USG) and PPG Industries Inc. (NYSE:PPG).
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Here are highlights from Monday's Analyst Blog:
New Home Sales Edge Up
New Home Sales rose by 4.4% in November from October, to a total of about
377,000. Relative to a year ago, sales are up a good 15.3%. This increase in
sales is very welcome and adds to the signs of a broadening housing market
There was, however, a downward revision to the October numbers of 7,000 from a
total of about 368,000. The November level also somewhat lagged the expected
rate of 379,000. Regardless of these changes, the overall trend is still
Also median sale price trended up clocking a gain of 3.7% sequentially and
14.9% year over year.
Results by Region
Regional trends and numbers were very mixed. The Northeast, by far the
smallest of the four U.S. regions in terms of new home sales, portrayed a
definite improvement, with sales up 12.5% on the month and up 69.0% from a
year ago. In November 2012 the region accounted for 7.2% of all new homes
sold, up from 6.6% in October.In the Midwest sales declined 12.5% sequentially
and were also down 5.8% on a year over year basis. In the West, sales were
down by 17.8% since last month but were up 13.7% since last year. The South,
by far the largest of the four regions (57.8% of total sales in November), saw
an increase of 21.1% for the month and 17.2% from last year.
New home sales have only exceeded the 400,000 level three times since
September 2008 when the financial markets collapsed. The last was in April
2010, when sales surged by a tax credit for first-time homebuyers.
With reference to the peak of the housing bubble in July 2005 (new home sales
of 1.389 million), new home sales are still down substantially by 72.9%, but
still improving. Overall the report looks positive and new home sales are
significant as they have historically led the economy out of recession since
each new home sold represents a lot of economic activity.
Not only are high new home sales good for the big homebuilders likeD.R. Horton
Inc. (NYSE:DHI), but also for all the companies that make the products and
supplies that go into making a new house. There is Berkshire Hathaway Inc.
(NYSE:BRK.B) for bricks, roofing materials and insulation, Masco Corp.
(NYSE:MAS) for plumbing fixtures and cabinets and USG Corp. (NYSE:USG) for
wallboard. The range also includes PPG Industries Inc. (NYSE:PPG) for glass,
It is of significance that all of the housing related data released during the
month buttressed the housing recovery (though expansion remains a still far
proposition), after suffering a huge breakdown in 2006. Permit issuance, an
indicator of future building activity, rose 3.6% to a seasonally adjusted,
annual rate of 899,000 units in November. Though housing starts slid 3.0%, it
should be viewed as a readjustment to more normal levels of production
following more than expected growth in the month of September and October.
National Association of Home Builders/Wells Fargo Housing Market Index (HMI),
which reflects builder confidence in the market for newly built, single-family
homes, posted a solid, 26 point gain year-over-year to 47 for December. On a
sequential basis the index was up by 2 points. This marked the eighth
consecutive monthly gain in the confidence gauge and brings it to its highest
point since May 2006, when the index stood at 46. While the inventory of
existing homes for sale narrowed down to 4.8 months, down from a 7-month
supply last November, sales of existing homes rose 5.9 % to 5.04 million
With housing hopefully back on track, we believe it will be one of the sectors
to give a much required push to jump-start the economy. It is also expected to
generate jobs for the twenty-somethings so they can move out of their parents'
house creating more demand for new homes and thus get the economy moving
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