Inman Index: Real estate stocks fall
behind in February
Tuesday, March 01, 2005
By Marcie Geffner
Inman News
February 2005 was another negative month for real estate
stocks on Wall Street, judging by a comparison of the
month-opening and month-ending valuations of the 14 stocks
that make up the Inman News Real Estate
Stocks Index.
The newest kids on the block among publicly traded real
estate companies lost some of their luster among investors
in February. Both HouseValues and
ZipRealty
dropped more than 15 percent of their market value, despite
good-news announcements. HouseValues posted what one
newspaper reporter called "a remarkable surge" in profits,
which jumped from $614,000, or 3 cents per share, in the
last quarter of 2003 to $1.9 million, or 8 cents per share,
in the last quarter of 2004. ZipRealty also reported a
substantial increase in fourth-quarter earnings.
Fannie Mae's shares also suffered again in February as
more negative developments surfaced at the mortgage
corporation. A Securities Exchange Commission accountant
warned it could take a year to sort out Fannie's faulty
prior-period financial statements; the White House joined
calls for a tougher regulator to keep watch over Fannie Mae,
Freddie Mac and the Federal Home Loan Banks; Federal Reserve
Chairman Alan Greenspan suggested a cap on Fannie and
Freddie's massive mortgage portfolios, and federal
regulators uncovered more bugaboos in Fannie's accounting
practices. Fannie's shares dropped more than 11 percent
while Freddie Mac's shares fell almost 7.5 percent.
An 8 percent share-price decline hit Countrywide
Financial Corp., which reported a year-over-year decline in
fourth-quarter earnings, a dip in month-over-month loan
fundings and a 20 cents per-share overstatement in its
fourth quarter financial results. The company said the
accounting hiccup was flagged by auditors and involved
embedded derivatives.
Cendant Corp. posted strong financial results from
continuing operations in the 2004 fourth quarter and year,
and spun off its Cendant Mortgage and Wright Express
operations into two separate public companies in February.
Shares of the spun-off mortgage operation, PHH Corporation
(NYSE: PHH), debuted Feb. 1 at $21.55 and closed Feb. 28 at
$21.28.
The announcement of a new marketing agreement between
Cendant's NRT brokerage subsidiary and Homestore, which
operates the National Association of Realtors' Realtor.com
Web site, put a temporary bounce in Homestore's shares,
although the terms of the deal weren't disclosed and the
stock was unchanged at month-end.
Mortgage lender Washington Mutual was the only company in
the Inman index that posted a measurable gain during the
month. Its shares rose more than 2 percent, in line with the
benchmark Dow Jones Industrials and besting the S&P 500.
The Inman index overall declined 7.5 percent.
Fidelity National Financial appeared unscathed by new
investigations into whether captive reinsurance deals within
the housing sector amounted to illegal kickbacks for
referrals of title business. Shares of the title insurance
company were virtually unchanged at month-end. Fidelity has
announced it will cease the arrangements that have been
called into question.
Wall Street took a dimmer view of Stewart Information
Services' 2004 earnings, which declined significantly
compared with the 2003's results. The title insurer's shares
dropped 5 percent in February.
|
Stock |
Ticker |
Feb. 1, 2005 |
Feb. 28, 2005 |
change |
% |
|
Cendant Corp. |
NYSE:CD |
$22.79 |
$22.15 |
-0.67 |
-2.94 |
|
Countrywide Financial Corp. |
NYSE:CFC |
38.03 |
34.75 |
-3.28 |
-8.62 |
|
E-Loan |
Nasdaq:EELN |
3.28 |
3.19 |
-0.09 |
-2.74 |
|
Fannie Mae |
NYSE: FNM |
66.17 |
58.46 |
-7.71 |
-11.65 |
|
Fidelity National Financial |
NYSE:FNF |
44.23 |
44.24 |
+0.01 |
+0.02 |
|
First American Financial |
NYSE:FAF |
37.52 |
36.55 |
-0.97 |
-2.59 |
|
Freddie Mac |
NYSE:FRE |
67.00 |
62.00 |
-5.00 |
-7.46 |
|
HomeStore |
Nasdaq:HOMS |
2.38 |
2.46 |
0 |
0 |
|
HouseValues |
Nasdaq:SOLD |
14.27 |
11.95 |
-2.32 |
-16.26 |
|
IndyMac |
NYSE:NDE |
38.96 |
35.99 |
-2.97 |
-7.62 |
|
Interactive Corp. |
Nasdaq:IACI |
24.22 |
22.5 |
-1.72 |
-7.10 |
|
Stewart Info. Services Corp. |
NYSE:STC |
42.10 |
39.99 |
-2.11 |
-5.01 |
|
Washington Mutual |
NYSE:WM |
40.96 |
41.96 |
+1.00 |
2.44 |
|
ZipRealty |
Nasdaq:ZIPR |
18.34 |
15.44 |
-2.90 |
-15.81 |
|
Inman Index |
|
466.74 |
431.52 |
-35.22 |
-7.55 |
|
Dow Jones Industrials |
DJI |
10,552
|
10,766 |
+214.00 |
+2.03 |
|
S&P 500 Index |
GSPC |
1,189 |
1,203 |
+14.00 |
+1.18 |
|
Nasdaq Composite |
IXIC |
2,069 |
2,051 |
-18.00 |
-0.87 |
|
Source: Yahoo Finance |
|
|
|
|
|
Disclaimer: The Inman Index is not intended to serve
as investment advice.
***
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Copyright 2005 Marcie
Geffner
Equal Housing
Opportunity