Standard Pacific Corp. (SPF)

An infusion of 530 million can't hurt and hopefully with help bring Standard Pacific back

short term to long term pick.

rally picks

fransgeraedts

When will the housing crisis end? I'll bet it wont be until 2010. This stock will be taken over by then when it finally reaches $0.75

Until management can learn to control receivables, this dog will keep scratching.

Houses destroyed during the CA wildfires need to be replaced. SPF is in the right place to do rebuilding these houses.

Since the Fed and the government have started to aggressively pump up the economy, I think there is a good chance that the bottom for homebuilders has been reached. The stocks usually bottom out 6-12 months before the real life economy.

From Morningstar.com:

The highlight of the quarter was the $348 million in cash from operations, which allowed management to garner a $219 million cash cushion and pay down outstanding debt by an additional $251 million. In all, net debt was reduced by $465 million from the third quarter, to $1.55 billion, and now amounts to 54% of trailing sales, down from 61% in the third quarter. Adjusted fourth-quarter earnings before interest, taxes, depreciation, and amortization covered interest expense 2.2 times, more than many builders at this point in the cycle. With $235 million arriving this month from the federal government in the form of a net loss carryback, Standard Pacific should be in a relatively good liquidity position throughout 2008--quite a contrast with what we and the market thought just a few months ago.

I bought this one for my real life portfolio at the same price like my CAPS pick. You can see me win or lose... ;-)

SPF has an illiquid balance sheet. It is also one of the most loss making companies.

Shorting all almost all Household goods (durables) and all homebuilders. with high unemployment, how do you expect people to buy houses or hold onto their mortgages? Because of tax credit, numbers are looking decent, but we'll be back to normal in no time... Short this !!!

SPF could go chapter 11 or it could survive and get back to book value (about $20) or it could get bought out by bargain hunting foreign interests. That's 2 out of 3 good outcomes and worth the risk at $3.58 a share.

I hope to catch this stock on the pop before investors realize that this short-term stimulus will be like the cash for clunkers program, resulting in a limited sales increase now followed by lower sales in the months to come.

Have we found the bottom yet? I doubt it. However, I strongly agree with floridabuilder that *somebody* has emerge from this mess, and they will do so in a formidable position going forward, with virtually no well-capitalized competition to worry about. A quick scan of the SPF financials shows me a builder suffering through a tough time, but still maintaining positive cash flow. I can only conclude that this bodes well for the company, as everybody else around them struggles to keep creditors at bay.

CAPS Rating: 1 Star [277 outperforms / 315 underperforms]

safe bet

more investment firms will buy in at the depressed homebuilder prices

Housing

looks good to me

Weak and Deteriorating Cashflow

liking stocks others don't