You guys are funny, and right. I wish I had the cajones to play builders. The truly scary thing to me, is that every home builder stock is actually very expensive, based on mid-cycle eps power, of course, which we are nowhere near.

I've always loved the argument they are cheap on book value. Who knows what book value is? The other thing about book value is that the builders as a group have delevered over the past decade. So while "normal" ROIC is the same, normal ROE is lower as equity becomes a larger component of the capital structure, and justifies a much lower than historical P/B.

P/B is the lazy man's way of figuring mid-cycle eps, since it essentially equals ROE X P/E. Stop being lazy and estimate EPS. Even assumming a full recovery, you will see how expensive these stocks are.

If there were such thing as a long-term short I'd add these guys to the list. But I don't understand how the short-term mania works with these POS stocks.