Rick Murray Continue Quotations

We continue to believe the company's assumptions appear to be somewhat aggressive given the recent softening in demand trends and the weak orders in the quarter.

It is clear speculators have headed for the exists in Phoenix. Given the increase in mortgage rates recently, it would seem as if this market will continue to face increasingly more challenging conditions, especially in light of the enormous surge in inventory.

As prices have stagnated since August, inventory levels have continued to grow, as we suspect an increasing number of speculators are placing their homes on the market.

The deterioration in home-building trends is materializing more rapidly than many had anticipated, including ourselves, and is likely to continue to put pressure on earnings expectations for the sector.