Hovnanian Enterprises Inc (NYSE:HOV)

CAPS Rating: 2 out of 5

Designs, constructs and markets high quality single-family detached homes and attached condominium apartments and townhouses in planned residential developments in the Northeast.

Recs

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Player Avatar BenPicks (< 20) Submitted: 3/19/2010 12:18:27 AM : Outperform Start Price: $4.73 HOV Score: -82.14

HOV has been the underdog housing stock in the pack. It has been a heavily shorted stock for the past three years, with over 40% of its stock float currently shorted.....this is 7-9 times greater short postion than the rest of the housing stocks.

With the $300 Million tax refund received last month and the hard write downs HOV has done the past 18 months, they have more than sufficient cash to wait out the housing recovery...that has already started!! The volume has been building the past several weeks as the news get's "less bad" for HOV and the shorts are getting nervous.

I started playing HOV in the high $2.00s and have enjoyed the ride with over 20,000 shares. The shorts know that the market at worst stay even for housing and they will have to pick there points to get out of there positions. As the shorts start to cover, this stock could easily start to see 2-4 million share days for a couple weeks and put this stock in the $6-8 range very quickly. Don't miss it!

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