Our colleague Frank Curzio was right… the government's incredible homebuilder bailout is sending stock prices higher.
Back in March, Frank told readers of the Growth Stock Wire about a huge new tax rule that would boost homebuilder earnings and share prices to new highs. Most people can't stand the thought of owning these stocks, so a contrarian had to be interested in the idea. How's it working out?
As today's chart shows, it's working out well. The big homebuilder fund XHB is trending higher… and just struck a new 52-week high. Even the fundamentals we track (like homebuilder sentiment and months of current housing supply) are improving.
The improving homebuilder conditions, plus the incredible price strength, prove that when the government wants to "reflate" a sector, chances are excellent that in the short-term, it's going to get it done.
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