When should you trade your Beazer Homes (USA Stocks:BZH) holdings?

BZH Stock  USD 14.94  0.17  1.15%   
While this unique economic environment continues, Beazer Homes may throw investors more surprises next quarter. We will look into a few reasons why it is still possible for the company to generate above-average margins and positive cash flow. On the 2nd of February the company is traded for 17.32. Beazer Homes USA has historical hype elasticity of 0.06. The average price elasticity to hype of competition is about 0.02. The entity is forecasted to increase in value after the next press release, with the price going to jump to 16.63. The current volatility of headline impact on Beazer Homes stock price is is way over 100 percent making price predictions on social media along less reliable. The price rise on the next news is projected to be 0.3%, whereas the daily expected return is currently at 0.84%. Considering the 90-day investment horizon the next forecasted announcement will be in about 8 days.
Published over a month ago
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Reviewed by Michael Smolkin

Beazer Homes USA's average rating is Hold from 3 analysts.
Our trade advice tool can cross-verify current analyst consensus on Beazer Homes USA and to analyze the company potential to grow in the current economic cycle.
The company has Net Profit Margin of 0.1 %, which implies that it may need a different competitive strategy as even a very small decline in it revenue may erase profits and result in a net loss. This is way below average. In the same way, it shows Net Operating Margin of 0.12 %, which entails that for every 100 dollars of revenue, it generated 0.0 of operating income.
The successful prediction of Beazer Homes stock price could yield a significant profit to investors. But is it possible? The efficient-market hypothesis suggests that all published stock prices of traded companies, such as Beazer Homes USA, already reflect all publicly available information. This academic statement is a fundamental principle of many financial and investing theories used today. However, the typical investor usually disagrees with a 'textbook' version of this hypothesis and continually tries to find mispriced stocks to increase returns. We use internally-developed statistical techniques to arrive at the intrinsic value of Beazer Homes based on Beazer Homes hews, social hype, general headline patterns, and widely used predictive technical indicators.
We also calculate exposure to Beazer Homes's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to Beazer Homes's related companies.

Use Technical Analysis to project Beazer expected Price

Beazer Homes technical stock analysis exercises models and trading practices based on price and volume transformations, such as the moving averages, relative strength index, regressions, price and return correlations, business cycles, stock market cycles, or different charting patterns.
A focus of Beazer Homes technical analysis is to determine if market prices reflect all relevant information impacting that market. A technical analyst looks at the history of Beazer Homes trading pattern rather than external drivers such as economic, fundamental, or social events. It is believed that price action tends to repeat itself due to investors' collective, patterned behavior. Hence technical analysis focuses on identifiable price trends and conditions. More Info...

How does Beazer utilize its cash?

To perform a cash flow analysis of Beazer Homes, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Beazer Homes is receiving and how much cash it distributes out in a given period. The Beazer Homes cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Beazer Homes Net Cash Flow from Operations is increasing as compared to previous years. The last year's value of Net Cash Flow from Operations was reported at 93.24 Million

Acquisition by Sun Pei of 2400 shares of Beazer Homes subject to Rule 16b-3

Legal trades by Beazer Homes insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
Beazer insider trading alert for grant of common stock by Sun Pei, VP Chief Accounting Officer, on 17th of November 2022. This event was filed by Beazer Homes Usa Inc with SEC on 2022-11-17. Statement of changes in beneficial ownership - SEC Form 4 [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Breaking down Beazer Homes Indicators

The current price rise of Beazer Homes USA could raise concerns from stockholders as the firm is trading at a share price of 17.32 on 373,840 in volume. The company directors and management may have good odds in positioning the firm resources to exploit market volatility in March. The stock standard deviation of daily returns for 90 days investing horizon is currently 3.17. The above-average risk is mostly attributed to market volatility and speculations regarding some of the upcoming earning calls from Beazer Homes partners.
 2020 2021 2022 2023 (projected)
Receivables25.68 M35.89 M41.27 M40.28 M
Inventories1.5 B1.74 B1.56 B1.44 B

Cost of Revenue Breakdown

Beazer Homes Cost of Revenue is increasing over the last several years with slightly volatile swings. Cost of Revenue is predicted to flatten to about 1.9 B. Cost of Revenue usually refers to the aggregate cost of goods produced and sold and services rendered during the reporting period. Beazer Homes Cost of Revenue is most likely to increase significantly in the upcoming years. The last year's value of Cost of Revenue was reported at 2 Billion
2015
2016
2017
2018
2019
2020
2022
2023
20151.52 Billion
20161.6 Billion
20171.76 Billion
20181.92 Billion
20191.78 Billion
20201.74 Billion
20222 Billion
20231.87 Billion

Our take on today Beazer Homes rise

Variance is down to 9.64. It may hint to a possible volatility drop. Beazer Homes USA currently demonstrates below-average downside deviation. It has Information Ratio of 0.19 and Jensen Alpha of 0.51. However, we advise investors to further question Beazer Homes USA expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Beazer Homes' stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Beazer Homes' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Our Final Takeaway

While many of the other players under the residential construction industry are still a bit expensive, Beazer Homes may offer a potential longer-term growth to stockholders. To conclude, as of the 2nd of February 2023, we believe Beazer Homes is currently undervalued. It actively responds to the market and projects below average chance of distress in the next two years. Our latest 90 days advice on the company is Strong Buy.

Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Rifka Kats do not own shares of Beazer Homes USA. Please refer to our Terms of Use for any information regarding our disclosure principles.

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