NEW YORK (Thomson Financial) - The homebuilder sector powered broadly higher
Thursday, as a surge in Pulte Homes Inc. on an improved liquidity position gave
a boost to sentiment.
The iShares DJ U.S. Home Construction ETF (ITB) hiked up 9% to $20.65, the
highest price seen since Oct. 31, with 20 of 21 components trading higher.
Volume on the sector tracking stock was 1.2 million shares in midday trading,
already nearly double the full-day average over the past 30 days of 654,000
shares.
The ITB has now gained 54% since hitting an all-time low of $13.41 in
intraday trading on Jan. 9.
Pulte Homes, the most heavily-weighted ITB component, soared 15% to a
3-month high of $15.55.
Although the company reported late Wednesday a wider-than-expected
fourth-quarter loss, revenue topped expectations and its cash position improved
by about $900 million over the third quarter to $1.1 billion, exceeding its $1
billion target. The company also said it expected to end 2008 with a cash
position of $2 billion to $2.2 billion, with no outstandings on its revolving
credit facility.
Banc of America followed by raising its price target on the stock to $13
from $9.50.
Among the other more heavily-weighted ITB components, D.R. Horton Inc.
surged 8.4% to $16.93, WCI Communities Inc. hiked up 15% to $5.99, NVR Inc.
climbed 2.8% to $620.16, Centex Corp. gained 4.6% to $27.61, M.D.C. Holdings
Inc. advanced 6.2% to $46.56, Toll Brothers tacked on 5.6% to $23.20 and Lennar
Corp. rallied 7.6% to $19.59.
Tomi Kilgore
tk1
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