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Strategies & Market Trends : Technical analysis for shorts & longs -- Ignore unavailable to you. Want to Upgrade?

To: Johnny Canuck who wrote (41213)	5/26/2004 12:22:41 PM
From: Johnny Canuck	Read Replies (2) \| Respond to of 69358

07:44 Value investors buying housing stocks -- WSJ column The WSJ's "Heard on the Street" column discusses housing stocks, which usually fall in fear of interest rates rising. Despite the potential troubles for the business, the recent weakness created a buying opportunity, some investors say to the paper. Sure, the housing market is going to be hurt and profits for home builders might slip, but shares are relatively cheap and profits in the business are so juicy that it likely will take big troubles in the housing market for these stocks to be crippled. While mortgage rates have climbed to 6% again, lenders are shifting to more-affordable adjustable and hybrid loans, reducing the possibility that the housing market will crater. Most important, the largest builders continue to grab market share from local builders, a trend that should help the stocks over the long haul. "If mortgage rates go above 7.5%, you start to worry, but rates are still relatively low," says Scott Black, president of Delphi Management, a Boston money-management firm that owns some of the largest builders. "These are the Rodney Dangerfield stocks of the Big Board" because they get so little respect. To be sure, bulls on housing stocks are making the risky bet that things will be different this time around. But for those investors willing to wager that mortgage rates won't approach 8% soon, housing-related stocks look attractive. Unlike most stocks in the market, home builders appear cheap, and the recent selloff has made them even more inexpensive. Stock mentioned positively include: Lennar, KB Home, Toll Brothers, D.R.Horton, Masco, Leggett & Platt, Ethan Allen Interiors, Lowe's and Home Depot. [Harry: This analysts assumption sound a little flawed to me and a tad desperate to support the sector.]