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alstry (36.08)

Analyzing the "Analysts" on Ryland

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11

April 19, 2008 – Comments (2)

Last year RYL ended Q4 with about $1.3 Billion in backlog and twice as many specs as this year. In a better selling environment and twice as many specs, RYL generated about $700 million in revenues or converting something better than 55% of backlog.

This year, RYL ended the quarter with about $786 million of backlog and half the specs of last year in a much more difficult selling environment. With half the specs, if RYL were to convert a similar backlog percnetage, they would be lucky to generate $400 million in revenues.

Factoring the lower spec count and more difficult selling environment, it is more likely RYL will only be able to generate about $325 million in revenues at much lower margins(save material land sales).

Currently, consensus analyst estimate is about $458 million, or higher than last years conversion rate when the company had twice as many specs and a better selling environment?

What a joke that these guys get paid for this kind of work.

At $325 million in revenues and lower margins, what kind of balance sheet do you think these guys will have at the end of this quarter? (Remember, RYL ended the quarter with about $510 in payables and accrued liabilities plus they have SGA to contend with...my guess is that cash will be much less than the $243 million they had at the end of last quarter.)

2 Comments – Post Your Own

#1) On April 19, 2008 at 1:45 AM, dwot (40.93) wrote:

Doesn't this oen have two kinds of shares as well?

I think I looked at this one and figure no point because the other kind of shares get the benefit first and you left with left. 

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#2) On April 19, 2008 at 7:12 AM, dwot (40.93) wrote:

That was wrong stock I was thinking about...

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