Time to buy homebuilder stocks?
Stocks like DHI dropped around 50% this year due to the housing bubble burst. DHI, for example, is trading at .76 price/book, and its long-term bottom is around 1. It also has a 4.4% dividend yield.
On the other hand, I read an article in the globe and mail today that the housing crisis will only get worse, and could last up to 5-7 more YEARS.
So when do great investors pick up these value plays? Is it worth the risk to pick some shares now and risk catching a falling knife? Or do we use some technical analysis and wait for a base to build up?
What do you guys think?
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