2-Star Stocks Poised to Plunge: Standard Pacific?
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, homebuilder Standard Pacific (NYS: SPF) has received a distressing two-star ranking.
With that in mind, let's take a closer look at Standard Pacific's business and see what CAPS investors are saying about the stock right now.
Standard Pacificfacts
Headquarters (founded) | Irvine, Calif. (1986) |
Market Cap | $1.2 billion |
Industry | Homebuilding |
Trailing-12-Month Revenue | $1.1 billion |
Management | CEO Scott Stowell (since January 2012) |
Return on Equity (average, past 3 years) | 4.4% |
Cash/Debt | $292.1 million / $1.4 billion |
Competitors | D.R. Horton |
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 63% of the 155 All-Star members who have rated Standard Pacific believe the stock will underperform the S&P 500 going forward.
Late last month, one of those Fools, MegaShort, succinctly summed up the bear case for our community:
[Standard Pacific] was on the brink of bankruptcy back in 2008, forcing them to dilute shareholders by raising equity. Now it's a $1.2B company?!?
They have continued to post losses for most of the last 4 years, but the market is rewarding them handsomely for recently climbing back to breakeven.
Along with [Hovnanian Enterprises] and possibly [Beazer Homes], I expect Standard Pacific to be hit hard in the next sell-off. They are lower quality homebuilders and overpriced compared to book value.
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The article 2-Star Stocks Poised to Plunge: Standard Pacific? originally appeared on Fool.com.
Fool contributorBrian Pacamparaowns no position in any of the companies mentioned. Try any of our Foolish newsletter servicesfree for 30 days.We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Fool'sdisclosure policyalways gets a perfect score.
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