Bear of the Day: Beazer Homes (BZH)

Core Insights - Beazer Homes USA reported revenue of $595.68 million for the June quarter, a 4% increase year-over-year, but EPS decreased to $0.88 from $1.24 in the same quarter last year [1] - The revenue fell short of the Zacks Consensus Estimate of $599.12 million, resulting in a surprise of -0.57%, while EPS exceeded the consensus estimate of $0.84 by +4.76% [1] Financial Projections - Analysts have significantly reduced profit projections for Beazer Homes, with the Zacks EPS Consensus for the current fiscal year dropping from $4.64 to $4.37, indicating a 15% annual decline [2] - For the next fiscal year, EPS estimates were cut over 10% from $5.28 to $4.72 [2] Business Demand Metrics - New home orders, net of cancellations, were reported at 1,070, below the average estimate of 1,399 by two analysts [3] - Units in Backlog for Continuing Operations were reported at 1,949, compared to the average estimate of 2,258 by two analysts [3] - Analysts' pessimism may be influenced by rising recession concerns following the Sahm rule triggered by increasing unemployment data [3] Stock Performance - Beazer Homes shares experienced a strong rally of 27% in July, benefiting from small-cap stock favorability [4] - The stock is currently bouncing off support at $26, a level that has historical significance from April and November [4] - Caution is advised for investors until profit estimates stabilize [4]