with respect to d.r. hortonparticular, one of their strengths is they operate in an affordable segment, lower-priced homes compared to something like toll brothers. they have been focussing on lowering their balance sheet risk how do they do that? a couple different ways. they have options on a lot of their potential land rather than going out and purchasing it and putting it on the balance sheet. and they focus a lot on roi. that normally stands for return on investment. but in their case they're focussing on return on inventory. and they're managing that quite effectively. as trade we like to use going into earnings, calendar spreads and call spread risk reversals we're going to use a little bit of a spin on both of those i was looking at a diagonal call risk reversal. specifically, selling the august 65 puts and 80 strike calls in august and using those proceeds to help finance the purchase of the at the money slightly in the money september 72.5 call for just under $6. the idea is to capture the accelerate a

>> we very much like pulte >> d.r. horton came out with their earnings this morning. when i looked at them on the computer, i sent a message to my team, wow! that's horrible and that played into our book that you have to start looking at valuation i think a lot of the new investors in the market they didn't care about valuations for probably the last five years, but right now you have to start looking at valuation d.r. horton was trading at 80% of next year's book value. pulte which i think is a higher quality book value, and they're more diverse with the entry level such as d.r. horton that they're more quality in my mind and still trading at more than book value i see that in the performance as it is priced in. >> david, we appreciate your perspective and there are a couple of soarities that david favors. >> cheers. >>> coming up, a regional banking powerhouse and huntington bancshares up today they're up 10% this month. we have the ceo talking rates, growth and his view of the economy. we are live from frankfurt on what europe's largest economy is doing to end its

we continuously see homebuilders, d.r. hortonit did not look like a good report but the stock was up. feels like sentiment is washed out. they're up as a group homebuilders 13% since july. i think market focuses on valuation now that sentiment has started to turn. liz: sentiment turned today. [closing bell rings] the dow is was down, now up 100 points. thank you for joining us. the markets finish the day and beginning of this week mixed. nasdaq down 50. folks, big earnings day tomorrow. "kudlow" is next ♪ larry: hello, folks, welcome to "kudlow," i'm larry kudlow. so we know that the biden democrats attempts to radically transform the american economy and its culture for that matter has led to sky-high inflation, economic contraction, and overall demoralization in just 18 months. radical, progressive experiment has once again failed. show me a poll, any poll, and i will show you a massive voter revolt against biden policies. of course there is

we'll get you ready for tesla, united air and d.r. horton next.sic - cover of blondie's “dreaming”] [music playing] ♪ dreaming. ♪ ♪ dreaming is free. ♪ - in the last two years, we quadrupled our team and the pace we're growing, i couldn't keep up without ziprecruiter. they do the legwork and they get my job posting in front of the right candidates. i love invite to apply. i instantly see great candidates and i can invite them to apply. we have hired across all departments, engineering, marketing, hardware, field techs. you can basically tell ziprecruiter who you need, when you need it, and they deliver. - [narrator] ziprecruiter. rated the number one hiring site. try it for free at ziprecruiter.com try it for free at ziprecruiter.com >>> welcome back earnings seen is now in full swing. let's get the action and trade on three important names about to report in today earnings exchange tesla is after the bell. shares higher for a sixth straight session but still down 30% this year and that is on pace for its first yearly loss since 2016 they do have

they're either crazy or the world is craze or maybe both d.r. horton is the name.nd it's a sub-5 p-e. you're a buyer here? >> yeah. no we really like this stock. we own it right now and this is a stock that has a really great long term story and there was a great article just recently that highlighted the shortage of homes not just on the coast which we've seen a shortage of homes there and the shortage of homes is leaking into the center of the united states which is and d.r. horton, they trade at a slight premium relative to other homebuilders and they're active in 32 states and they're playing across the spectrum from affordable housing to luxury housing and so we think that the long term story on this is very, very strong and this is a company that just has an enormous profit margin and they maintain that profit margin even as costs have risen. >> so sticking with it >> the one you're bailing on -- drum roll, please, is snap much like netflix is down 70%. netflix is still okay in your book and snap, you say earnings and watch ability, watch out >> snap is still

d.r. horton reported weaker than expected quarterly orders.y focus on entry-level buyers, the ones most affordable -- vulnerable to the affordability squeeze. global news 24 hours a day, on-air, and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. >> this world has plenty of room for competition between china and the united states and others, as well. that is really the kind of globalism we ought to be seeking, which is one of having strong competition with china and others. jonathan: leon panetta, the former secretary of defense. good morning. counting you down to any ecb rate decision, 8:15 eastern time. down 1% on the s&p. the nasdaq down slightly, we can call that unchanged. crude is lower by almost 5% this morning. -4.6%. the euro-dollar, 1.0183. for those of you asking why 8:15 instead of 7:45? i don't know. someone said the ecb shipped was perhaps no clash with u.s. data. no idea. tom: maybe. jonathan: i have no idea. tom: one of the great france

look at lennar, pulte group and d.r. horton. ratios of these stocks are in the single digits right around four. four times next year's earnings. mortgage lenders like rocket companies, loandepot off over the past week and that's off over the past year as we know and rocket remains 50% off yearly high and you kind of keep some of these things in perspective. >> coming up on the show, edgy investments. today's three-stock lunch is taking a shot at some names with strong risk and maybe reward profiles >> plus the economic enigma and the jobs report coming in ceionger than expected to find ressn fears and we will discuss what it all means when "power lunch" returns after this break. >>> welcome back, everybody. time for our weekly etf tracker. we are following the money and we are looking at biotech this week $142 million of net inflows. like tech, the biotech stocks have been bouncing back after a rough start to the year and the news that merck is close to a $40 million deal to buy seagen and take over news always a catalyst the ga

they're likely to be very strong i want to see the cancellation rate we saw d.r. hortonort jumped up. i'm looking at any guidance that might change going forward anything on pricing as well. mortgage rates did pop-up significantly in june after rising steadily from january again twice what they were in january. an also we saw builders sentment plunge historically in july. that's what we're looking for going forward. for the builders, it's all going to be about that outlook ahead especially when we look at potential supply chain easing. the we're starting to hear rumors does that mean they're able to build the homes faster and have much bigger backlog if they're not able to sell them now? we get sales tomorrow as well. so that will play into that. for pulte, it's what the look is ahead. >> i've been drooling over the home builders pes. carter this morning who was bullish as a pair trade on the builders for the past couple several weeks is saying take your money and run what do you say? >> >> yeah. i would agree with carter. the values are strong. low pes. i think it's bef

d.r. horton to report this thursday and we'll look at one name that looks technically sound ahead of results and one that's a bit shaky that's on "power lunch" which begins right now ♪ ♪ ♪ >>> good afternoon, everybody. welcome to "power lunch. i'm tyler matheson we're flying high right now with boeing shares up 10% in a week and delta placing a big order and i do mean big. bank of america hiking its price target on that company if sentiment is turning is boeing now a buy plus, bitcoin miners and power down in texas as the intense heat tests the grid there. the ceo of riot block chain here to discuss the impact on the mining community and whether today's rise in bitcoin prices will continue. kelly? >> tyler, thanks look at this, we're erasing a 356-point gain on th

largest single drops in the survey's history meantime the home builder stocks, lennar, kb home, d.r. hortontheir shares fall 30% on the year. they are down today as well even though there is some strength in the consumer discretionary group. some of the travel names are doing well joining us now to discuss, ivy zelman ivy, this was an ugly drop in home builder sentiment where are we in the process of the housing slowdown, do you think? >> first, thanks for having me back, sara i would say that the rate of change has been pretty dramatic and i think we're just in early innings. we've seen deterioration that really started in may and the acceleration of that negativity has just been continuing through early july i'd call it mach speed in some markets. it does vary by market, so we see the biggest rate of decline probably in phoenix with the southeast and florida markets holding up better. so it's not across the board the sentiment is negative because affordability is so stretched. but i think that it really varies by market right now >> diana olick, our housing reporter, noted in an email to

d.r. horton down another 2% today but down 28% for the year. the market has already priced in a lot of this overall. what you see here, if you just take a look at where the markets are going here, we keep waiting for an earnings apocalypse that hasn't happened it's been a month, the market was freaked out about an imminent drop in earnings and it hasn't happened. so today this is what matters. q3, q4 we're still 10% growth today july 1st it was 11%. all right. it's down but not dramatically they're not slashing the numbers. q4, still at 10% it was 10.6% on july 1st you get my point modest declines but no earnings apocalypse because the bulls are regaining control of the narrative, which is the fed is front end loading all the rate hikes. there will be rate cuts in 2023 and any recession might be mild. that's the new buzzword, a mild recession. larry fink mentioned that yesterday. as a result of growth stories, look how the growth sectors on the s&p have been reacting since we bottomed on july -- excuse me, on june 16th ark is having a mini rena

the starts in single family down year-over-year and this is when we talk about the big builders, d.r. hortonwn. you saw it in the builder sentiment numbers yesterday, an epic drop of 12 points, the largest really this the history of that survey on builder sentiment. builders did note that they are seeing price cuts, more and more builders drop prices we had someone on yesterday saying we are just in the first innings of what you call that retrenchment i would note that the big gains we are seeing are in multi-family that's a good sign we do need more multi-family rental housing granted it takes a lot more time to plan, to prepare for this it's not reacting to the markets the way single family is these numbers are for june june is where we saw them start at 5.436%. builders saw that, and obviously you're seeing that in the single family numbers it made buyers pull back buyer traffic was coming down, i think going forward, we're about to get some build builder earnings soon. we are going to see a significant pull back in housing going forward, and that could mean lower prices, but, again, pric