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Gold/Mining/Energy : Big Dog's Boom Boom Room
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To: kodiak_bull who wrote (5213)11/26/2001 1:38:44 PM
From: CpsOmis  Read Replies (2) of 206353
 
KB, Gottfried,

That's what hit me looking at these. The P/E's have not spiked, rather, they are all pretty closely aligned, and not all that pricey.

But if I understand you correctly, you are saying that P/E's and sales figures are a rear-view mirror approach which won't work in the builders because they have sharp (cyclical) changes in profitability much like the OSX? So a high P/E means you are in a trough of the cycle?

I remember the media pounding away at the idea that a surge in homebuilding is an early indicator of a turn-around in the economy.

Does the drop off of homebuilding lag or precede a recession? I would think it would lag, and the obvious question would be to what extent, and is that measurable by historical means? The next question is what other economic indicators can we look at historically against the price and earnings performance of the homebuilders to see if there are distinct trends?

RYL actually had a 4% build in orders and 12% increase in backlog last month. That surprised me.

Cosmo

P.S. I am witnessing what I would surmise is fund buying in BZH today. I've seen a single order of 15K shares ($900K) and another of 5K.

I have a very simplistic view of the 'January effect', in that winners will continue to surge and losers fall through the end of the year due to money being pulled out of losers and having to go somewhere. Perhaps the best time to short some of these for the long haul is mid-December. Until then, I think I will be trading in and out.
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