Trading debt for stock. $127 million in debt for stock. Current shareholders will be diluted but zero earnings divided by a larger denominator is still zero. In the end, just leads to money to continue the business as the housing market improves. Do not think the stock goes down that hard or stays down that long.
BZH reports Friday with a similar DHI story: little in the way of write downs, NOL money coming ink, improving margins, better sales, less debt. Will those shorting the stock continue as the stock begins its climb?
Congrats to the both of you. I'm a housing bull but I like to hear a discourse and this one was VERY GOOD. I respect the bear and the bull here. But I think, come on, the stocks at 5 bucks. Do you really want to short it, come on!
half u guys don't know what the hell ur talking about! set your stops below 4.70 thats the max power of the bears now. any stock offering doesnt make a diff. look at DNDN, HGSI, C it goes up in the end.
I'm glad that u have done well!! This company is no F or any of the others you listed. Time will tell if it will survive. At this time and place for me it matters not. Making as much money as i can right now does. We have different styles of thinking at this time. For your sake and the rest of those who plan on holding long term i only hope the best. Power House days of old are just that though. But ya never know! And who knows if this goes low enough i may even buy and hold some long term! Now is not the time IMO. G.L.
Sounds like you might like to be a buyer at lower prices. Will BZH go to 2 or 3? Very doubtful. I bought the stock in the early 2000s and watch their CEO turn this company into a powerhouse. I sold at 80 and 70 and used the proceeds to fund my children's college. I bought back at $4 after discovering it had survived. How could anything survive all the things BZH went through: scandals, a housing crash, lawsuits, investigations? And you are worried about stock dilution? Do you think that is the last straw for the company? Shorting at $4 plus? I would suggest buying when it's on sale. Would you have liked to buy F at $4 or BAC at $3 or ANN at $4? Lots of stocks were going to the "graveyard" but their deaths were premature. This one's obit is equally premature. Between debt reductions, equity offerings, tax refunds, sounder business practices, this is going to be awash in $.
My hold rating is for my position i hold now which is a short position. Even out six months the sector as a whole should be rated one below strong sell. Maybe strong smell. The older i get the less i understand why with the ability to watch your investment in real time why ppl still hold threw thick and thin?!? If i feel i can sell today and buy next month at a lower price why wouldn't i? Just that many more shrs i then can purchase. By doing this i have almost doubled my money since Qct. Can u say that on this one? Sell now and wait for the threes and maybe even the 2's and have twice as many shrs or if you are afraid of missing out buy heavy at the open tomorrow. G.L.
1. I see you have a hold on BZH. Has your negative feelings towards the stock decreased?
2. The BZH bonds have soared in value. Bond holders are not displeased with BZH's future.
3. The Fed is worried about housing. In their notes, they will do whatever to ensure the housing recovery.
4. The $ from the offering goes to pay down debt. Like F, BAC. Remember what happened to those stocks. F did multiple offerings at $5.
5. Increasing business.
6. NOL returning $101 million.
7. 10 to 12 tiny cap public builders left to service over 300 million people's housing needs.
8. Successful refinancing of debt this year.
9. Improving equity position.
10. Staying alive in the Great Depression of housing.
I would change my hold to a buy. In 3 years, you will wish you had.
When debt is taken out, equity rises. Book value unaffected by share increase.
Convertibles are another problem. However, this stock is so heavily shorted doubt has any affect.
Look 18 million added stock, $50 million convertible and stock price down 13%. The shareholders know the negatives about the company. It is largely baked in. Buying opportunity only.