iShares US Home Construction
Must-know update: Are retail sales poised for a spring surge?
For the week ended March 15, retail same-store sales grew 0.7% and 1.5% week-on-week and year-on-year, respectively.
Housing Stocks Rallied Then Came to a Halt in December
Housing has been a bright spot in the US economy. But over the past month, housing stocks haven’t been performing well. ITB, a housing-focused fund, has fallen 4.7%.
Non-farm payrolls, average hourly earnings rise
US non-farm payrolls rose by 295,000 in February 2015 from a downwardly revised January number of 239,000 compared to 257,000 reported earlier.
Wage Growth Could Be Picking Up
Average hourly earnings rose by 9 cents on a month-over-month basis in October and were up 2.4% YoY (year-over-year) to $25.20. However, wage growth is still barely outpacing inflation.
Why Are Lennar’s Higher Margins Unsustainable?
Buyers are reluctant to pay higher prices, and builders have to offer incentives, which reduces margins. Lennar’s higher margins will not be sustainable.
The Housing Industry Is Painting a Positive Outlook for the Economy
In April, the number of building permits issued was reported at 1.35 million, a decrease of 1.8% from the downward revised March reading of 1.37 million permits.
Wages Dipped Slightly in December: Here’s Why
Average hourly earnings fell by 1 cent on a month-over-month basis in December 2015 and were up 2.5% year-over-year to $25.24. Average weekly hours were flat at 34.5.
What Led to Home Depot’s Record Results in Fiscal 2016?
Home Depot (HD) reported record results in fiscal 2016. Sales reached a new high of $88.5 billion in fiscal 2016, up 6.4% year-over-year (or YoY).
Why higher costs and charges impact Armstrong’s business segments
Resilient Flooring net sales in the second quarter and first six months of 2014 declined 2%. Net sales were driven by lower volume in the Americas and Europe. Operating income also declined.
Why you should invest in homebuilder ETFs like XHB and ITB
ETFs present another investment avenue. Apart from pure homebuilder ETFs, there are many other ETFs that offer exposure to homebuilders.
Why Lowe’s Is Trying Hard to Woo Professional Customers
A professional customer is one who’s looking for products to complete projects for other customers.
New Home Sales Fell 6.80% in June: ITB Fell 2.20%
Existing home sales in the US recorded a 482,000 annualized figure in June—compared to 517,000 recorded in May. It failed to meet census expectations of 550,000 units.
Investing in Lennar through Homebuilder ETFs
Lennar sees allocation in major sector-specific homebuilder ETFs such as the SPDR S&P Homebuilders ETF (XHB). XHB has a 3.36% stake in Lennar.
Why are we seeing broad-based house price gains across the US?
The Federal Housing Finance Agency Housing Price Index for March was released on Tuesday, May 27. This release also included quarterly data comparisons for Q1 2014.
Why Treasury and mortgage rate spreads hit historic highs
The interest rate spread between 10-year Treasury securities (IEF) and 30-year conventional mortgages (VMBS) was at historic highs at the end of 2008 and the beginning of 2009
A Brief Overview of Honeywell Automation and Control Solutions
Honeywell (HON) provides control solutions for various residential and industrial applications through the Honeywell Automation and Control Solutions–ACS unit.
Why Lowe’s Bought Orchard Supply and Is Eyeing Smaller Stores
Lowe’s is also experimenting with the idea of rolling out other smaller format stores like City Center stores in other under-penetrated and high-density urban areas in the US.
How to Invest in D.R. Horton through ETFs
D.R. Horton sees allocation in major homebuilding sector-specific ETFs like the iShares Dow Jones US Home Construction Index Fund (ITB).
How Does Lennar Compare to Its Peers?
Lennar showed mixed results compared to its peers based on the PE and PBV ratios. The ETFs outperformed Lennar based on the PE and PBV ratios.
Analyzing the Fall in December’s Existing Home Sales
According to the January report from NAR, existing home sales decreased 3.6% to a seasonally adjusted annual rate of 5.57 million homes in December.
The bad: Why the housing market has yet to find shelter
The housing market, especially construction, has been a cause of concern to policymakers in the Federal Reserve.
The Fed calls job gains ‘strong,’ not ‘solid’
Job gains may have been strong, but two other measures are also important—the labor force participation rate and average hourly wage growth.
Lennar Keeps Reporting Big Increases in its Revenue
For the first quarter of 2015, Lennar (LEN) reported $1.6 billion in revenue. This is an increase of 21% year-over-year.
Labor Market Ended 2015 with Strong Payroll Growth in December
In December 2015, non-farm payrolls increased by 292,000, easily topping Wall Street’s estimate of 200,000.
Why home prices should be moderated—Home Price Index
The 20-city index reading for March, implied an average month-on-month (or MoM) price increase of 0.9% in the 20 metros tracked by the index.
Analyzing Lululemon’s 3rd Quarter 2014 Financial Results
Lululemon’s latest results were well-received by markets. The stock jumped over 9% after the company released its results on December 11.
Why was indirect bidder demand for 30-year bonds higher?
The 30-year bond is the longest maturity Treasury security.
Why Home Depot and Lowe’s Are Leaders in Home Improvement Retail
Lowe’s (LOW) operates in the home improvement retail industry. The company competes with a number of retail and wholesale players.
Analyzing Lowe’s Merchandise and Services Assortment
Lowe’s sources its merchandise from over 7,000 suppliers with no supplier accounting for more than 6% of sales.
How Home Depot Is Leveraging the Pro Customer Opportunity
Driving growth from sales to pro customers is a key growth opportunity for the world’s largest home improvement retailer.
How Home Depot Drives Membership Loyalty With Pro Customers
The Home Depot’s (HD) focus on the pro customer allows the retailer to compete in the installations market and the product demand the services create.
Lowe’s $2.3 Billion Rona Acquisition: A Fair Price for Growth?
Lowe’s (LOW), announced that it had entered into a definitive agreement to acquire Canada’s largest home improvement retailer, Rona (RON.TO).
How do interest rate expectations impact financial markets?
The inflation and interest rate expectations of consumers and firms are important variables determining bond prices.
How Building Permits and the Housing Market Can Predict Trends
When real estate developers or REITs like AvalonBay (AVB) are confident about the economy, they build more in anticipation of future demand from consumers.
Does the Fall in US Consumer Confidence Signal Bigger Concerns?
The US consumer confidence index recorded its biggest fall in more than three years in December.
Are Indicators Signaling a Downturn in US Economic Growth?
The OECD (Organisation for Economic Co-operation and Development) has said that global economic growth has peaked.
Sherwin-Williams: Analysts’ Recommendations
For Sherwin-Williams, 64% of the analysts recommended a “buy,” 36% recommended a “hold,” and none of the analysts recommended a “sell.”
Could New Home Sales Continue to Rise?
The US Census Bureau and Department of Housing and Urban Development report monthly data on the number of new homes sold in the United States.
Why Existing Home Sales Have Been on a Continuous Slide
The United States National Association of Realtors (or NAR) releases a monthly report on the existing home sales (ITB) market.
What American Builders Were Worried about in June
The HMI was reported to have decreased by two points to 68 in June as compared to a May reading of 70.
Are Rising Rates Affecting Housing Markets?
Rising interest rates increase the cost of owning a home for prospective buyers, but the housing market hasn’t yet felt the impact of rate increases.
Why May Consumer Confidence Signals a Strong Second Quarter
The consumer confidence index has increased to 128.0 in May as compared to a downward revised April reading of 125.6.
Why the Fall in April New Home Sales Isn’t a Reason to Worry
As per the recent report, new single-family homes (XHB) sold in April were at a seasonally adjusted rate of 662,000 units.
Why Existing Home Sales Continued Their Decline in April
The US National Association of Realtors (or NAR) releases a monthly report on the existing home sales (ITB) market.
Should Housing Investors Worry about Declining Building Permits?
An increase in the number of building permits in any given month is a signal for increased activity in the housing sector (DHI) in the future.
Why American Builders Remain Confident about the Housing Industry
The housing market index was reported to have increased by two points to 70 in May compared to the downwardly revised April reading of 68.
Here Are March’s Trends in Existing Home Sales
According to the NAR’s April 2018 report, existing home sales rose 1.1% to a seasonally adjusted annual rate of 5.6 million homes in March.
What to Make of the March Increase in Building Permits Issued
The US Census Bureau and Department of Housing and Urban Development report monthly data on building permits issued in the United States.
Why a Rebound in March Housing Starts Isn’t Satisfying the Sector
The volatility in housing starts data remains elevated. Housing starts in March were reported to have risen 1.9%.
Why American Builders’ Confidence Fell 1 Point in March
The HMI (housing market index) was reported to have decreased by one point to 69 in April 2018.
3.2 Million Americans Quit Their Jobs in February
The “Job Openings and Labor Turnover Survey” (or JOLTS) data for February was reported on April 13, and it contains information about job openings and total separations.
Non-Manufacturing Sector Grew for 98th Consecutive Month
In March, the service sector continued to grow but at a slower pace.
How Existing Home Sales Trended in February
The United States National Association of Realtors (or NAR) releases a monthly report on the existing home sales (ITB) market.
What to Make of the Drop in Building Permits Issued in February
The decrease in building permits spanned across the sectors in February.
What’s behind the 7% Fall in February Housing Starts?
Just as markets were celebrating the stellar 9.7% increase in housing starts in January, the February data proved to be a damper for that enthusiasm.
How Confident Are American Builders?
The March housing market index reading is at 70, a one-point decline from the revised February reading of 71.
Why the US Workforce’s Quit Rate Has Remained High
January’s JOLTS (Job Openings and Labor Turnover Survey) data, which contains information about job openings and total separations, was reported on March 16.
Why the Rebound in Building Permits Is Positive for the US Economy
The Conference Board uses the number of building permits issued as one of the key constituents of its LEI (Leading Economic Index) model.
Could the Lower 4Q17 GDP Estimate be Reason to Worry?
The US Bureau of Economic Analysis (or BEA) has released its second 4Q17 GDP estimate, projecting that the US economy increased at an annual rate of 2.5%.
Why Declining Existing Home Sales Are Considered a Positive Sign
The United States National Association of Realtors (or NAR) releases a monthly report on existing home sales (ITB).
Why American Homebuilders Are Confident about Industry
February’s HMI reading was reported at 72, unchanged from the January reading and two points below the 18-year peak reported in December.
Why Building Permits Didn’t Change in December
For 2017, 1,263,400 housing units have been authorized by building permits—a 4.7% increase from 1,206,600 housing units in 2016.
How Confident Are Homebuilders at the Beginning of 2018?
Comments from NAHB members indicated that homebuilders are optimistic about the future demand and projected increased activity in the housing sector.
Building Permits Fall in November: Should We Worry?
Building permits and the economy The number of building permits issued each month is a constituent of the Conference Board LEI (Leading Economic Index). The construction and housing industry (PKB) is a major job provider in the economy, and changes in activity in the sector affect employment conditions and aggregate demand. A higher number of building permits is a leading […]
Existing Home Sales: Strongest Pace in 11 Years
According to the latest report from NAR, existing home sales rose 5.6% to a seasonally adjusted annual rate of 5.81 million homes in November.
Housing Market: Builders’ Confidence Reaches an 18-Year High
For November, the NAHB Housing Market Index was reported as 74—an increase of five from October and an 18-year high.
Should Investors Be Concerned about Fewer Building Permits?
In November 2017, housing units (XHB) authorized by building permits were at a seasonally adjusted rate of 1.298 million—a decrease of 1.4% from October.
Technological Disruptions: The Only Jobs Killers for Now
ADP’s jobs report for November was published on December 6. It provided deeper insight into improvements in US employment.
Conference Board Consumer Confidence Rose in November
The Conference Board Consumer Confidence Index for November came in at 129.5, up from 126.2 in October.
Households Think It’s a Good Time to Buy a Home
According to the latest report from NAR, existing home sales have risen 2% to a seasonally adjusted annual rate of 5.48 million in October.
Housing Market: What a Rise in Building Permits Signals
In October 2017, building permits were at a seasonally adjusted rate of 1.297 million—an increase of 5.9% from the reading of 1.225 million in September.
Here’s What Drove Consumer Expectations Lower in November
The University of Michigan Preliminary Consumer Sentiment for November was reported at 97.8, which was 2.9 lower than the final October reading of 100.7.
This ISM Index Hit a Lifetime High in October
For October, service sector activity rose at a pace not seen since the inception of the report. The non-manufacturing index reached a lifetime high of 60.1.
Which Sector Jobs Bounced Back?
Given that markets remain focused on the next Fed chair appointment and US tax reforms, volatility (VXX) could be low after the October jobs report.
Is the Drop in September Building Permits Cause for Concern?
In September 2017, building permits were at a seasonally adjusted annual rate of 1.215 million—a fall from August’s 1.272 million and 4.3% below September 2016.
How FOMC Members Assessed the US Labor Market in September
FOMC members noted that labor market conditions could take a hit due to the hurricanes in August and that this was evident in the October non-farm payrolls report.
Which Job Sectors Saw the Most Impact from Hurricanes Last Month?
As per the September ADP Employment Report, there was a major drop in the number of jobs created in the trade, transport, and utility sector.
This Is Why the US Dollar Could Slide Further
US Dollar index reaches a 14-month low The US Dollar Index (UUP) continued with its fall as investors preferred major peers. In the week ended July 21, the US Dollar Index closed at 93.78, falling 1.7% from the week prior. It is headed for its fifth consecutive month of loss this year. Conflicting news from […]
Why the Fed Isn’t Satisfied with Labor Market Conditions
Despite the strong growth in employment numbers, the Fed’s latest monetary policy report had some comments about slow wage growth.
How Will S&P 500 React to Another Rate Hike This Year?
The Fed’s decision had a limited impact on the S&P 500 (SPY), which closed last week at 2,433.2, a gain of 0.06% for the week.
Why a Black Swan Event Is a Possibility
As central banks buy up more bonds and more bonds move into negative yields, investors search among a smaller pool of substitutes and trades get crowded for higher risk alternatives. According to the Wall Street Journal, higher prices for stocks, bonds, and real estate have caused net wealth to swell to over 500% of national […]
Stanley Black & Decker Shares Roar on Spectacular 2Q16 Performance
Stanley Black & Decker (SWK), the world’s leading toolmaker, declared its 2Q16 earnings before the Market opened on July 22. SWK stock closed 4.8% higher on the day of the earnings release.
How to Navigate Uneven Economic Growth
A number of factors have contributed to the slowdown, including soft overseas growth and a sharp drop in capital spending by energy and mining companies.
Stanley Black & Decker’s Tools and Storage: Global Sales
Stanley Black & Decker (SWK) derives more than half of its tools and storage sales from the United States, making it the company’s largest regional market.
How Structural Changes in the World Economy Affect Markets
For the last few years, the world has been in the midst of a major demographic transition, which has affected the world economy. The aging population is one of the most visible global trends
Why Lennar’s Focusing More on First-Time Buyers
In the second quarter, Lennar’s (LEN) gross margins fell 190 basis points sequentially to 22.7%.
How Millennials Are Driving Broader Economic Shifts
But though millennials may have been born into unlucky economic circumstances, they seem to also be transforming their luck.
Median Existing Home Prices Are Rising Higher and Higher
With a rise of 7.6% YoY (year-over-year) to $224,000, December 2015 was the 46th consecutive month of YoY increases in median home prices.
Existing Home Sales: Northeast and Midwest Led the Charge
All four major regions of the country witnessed substantial increases in home sales in December 2015. The charge was led by the Northeast and Midwest.
US Dollar Index Fell, GDP Revised Down
The US Dollar Index measures the strength of the US dollar against the other major currencies. It fell by 0.13% on December 22, 2015.
December’s Housing Market Saw a Drop in Buyer Traffic
According to the National Association of Home Builders (or NAHB), the housing market index fell by a single point to reach a level of 61.0 in December.
Organic Growth Boosts KB Home’s Revenue
KB Home (KBH) has a market cap of $1.34 billion. After the earnings report in 3Q15, KB Home rose by 1.04% to close at $14.60 per share.
Sharp Rise in Average 2014 Toll Brothers Sales Price
The sales price of units closed or delivered during 2014 was $725,000, up by 13.5% from 2013. This is the highest sales price increase Toll Brothers has witnessed in the past three years.
New Homes Boost Lennar’s Performance
Lennar (LEN) has a market cap of $10.36 billion. Lennar’s YTD (year-to-date) price movement has a mixed performance with ups and downs.
Understanding Toll Brothers’ Land Acquisition Strategy
Toll Brothers’ use of land option agreements reduces financial risks associated with long-term land holdings. The land acquisition strategy of other homebuilders also involves option contracts.
A Geographic Overview of Toll Brothers’ Homebuilding Operation
Toll Brothers (TOL) has a very geographically diverse homebuilding operation in the United States. The company has a presence in 50 markets, spanning 19 states as well as the District of Columbia.
Investing in Toll Brothers: A Must-Know Company Overview
Toll Brothers is primarily engaged in the development of attached and detached homes in luxury residential communities. It’s a dominant player in the luxury segment with very few comparable competitors.
Toll Brothers’ Key Business Segments
Although the majority of Toll Brothers’ (TOL) business is focused on move-up homes, the company also offers second-home, empty-nester, and active-adult product lines to its home buyers in the United States.
Rental Vacancy Rate Dips to Its Lowest Level in 30 Years
The drop in the rental vacancy rate suggests that owning a home still isn’t affordable for many people, despite an economic revival.
Housing Starts Figures Should Lift the Economic Growth Forecast
Housing starts and building permits figures for July, released by the United States Census Bureau, were highly anticipated by investors in the US real estate sector.