Hovnanian shares rise on weekend sale buzz
Shares of U.S. new home builder Hovnanian Enterprises rose nearly 10 percent on Friday amid an ongoing housing downturn on buzz about a weekend sale which starts today.
Hovnanian's (NYSE: HOV) Deal of the Century which covers homes across 18 states gives incentives of up to $100,000 and also offers of extra appliances. Optimistically, the company believes it can sell between 700 and 1,000 homes, according to reports.
Prices range from the high $100,000s to the mid $1,000,000s. Some incentives require the use of the company's affiliated lending company.
Robert Curren, Managing Director and analyst for homebuilding at Fitch Ratings said the sale was not likely have a big impact on the home builder since only a relatively small percentage of its total homes are involved. He said, however, that that the company had created some buzz about the event.
[The sale is] in the vein of what a lot of the other major home builders have been doing, he said.
Shares of Hovnanian closed up 97 cents, or 9.7 percent to reach $11.00. The company's stock has dropped by more than two-thirds since the early part of the year.
Ara Hovnanian, the company's chief executive said in an interview with Bloomberg Friday that he sees the bottom of the housing downturn is very near but said that it would stay there for a while before a recovery.
Curran added that in his view it's hard to call the bottom before it passes.
At a minimum it's not clear that we're approaching a bottom, he said.
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