Booms, Busts, and Recoveries Message Board

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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: TobagoJack who wrote (57106)	12/9/2004 11:07:54 PM
From: Snowshoe	Read Replies (2) of 74559

Jay, I suppose housing could have an insane blow-off like the Naz in 2000. Here's what Cramer said today... Toll Has Earned Its Higher Multiple thestreet.com... By James J. Cramer RealMoney.com Columnist 12/9/2004 11:34 AM EST URL: thestreet.com... Oh my, danger, danger! Toll Brothers (TOL:NYSE) is selling at a double-digit multiple! I think people still have that misperception about homebuilders. I think that most people believe members of this group are monolithic, controlled by rates and totally and completely cyclical. Not me. My experience with Toll has to do with my life as someone who is anti-developer. I see the company in action. I know that it can get the parcels that are needed to build high-end homes and that its management's knowledge of markets and the law is so proprietary that you have to give the company a higher multiple than the others. I will have Joel Rassman, Toll's terrific CFO, on "Kudlow & Cramer" tonight to discuss some of these trends. Most of the time, we are so used to seeing proprietary, secular growth stories become cyclical low-multiple stocks that we can't accept the fact that the process can and occasionally does go in reverse. Toll is the poster child for that reversal. Toll has figured out how to build homes in areas where the profits are huge and the business is great. And it is still cheap.

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