it was lenar and gm. lenar has been a home builder since the '50s from a multiple perspective, 2017 lennar had a 15 pe. right now trading about a 4. if you read their earnings that they had a couple weeks ago, gross margins were higher, earnings were higher $320 million stock buy back. they have a little dividend, but that's not why i bought it i think structurally we know we have a shortage of homes in the u.s. right now obviously the market punished this name i am aware it could go from 4 pe to 3 as an entry point now, getting to peak pessimism. i believe a year from now jay powell is likely to cut than raise rates. we go into financial tightening into a stalling economy. as an investor, i want to look not straight down, i want to look out i took an initial position, prepared to add more totally different. >> bryn, how confident, though, are you in the e because in my experience when a very heavily cyclical stock is selling at a single digits multiple, it is because the market doesn't believe that that

we've had earnings releases from lenar and lenar's chairman said he saws a real turn around at the start of june. stewart miller said the effect of high prices and higher interest rates are causing buyers to, quote, pause and reconsider s jb holmes ceo said sales rates are are moderating from the recent exceptional levels. the difference in kb is they have a bill to order model so, baers can work to reduce costs and they're not left with a huge back log of unsold homes. sales fell again in may. those numbers are based on closing. those are contracts signed in april when rates were lower. weakness is affordability and lack of supply the number of homes on the market is increasing, up from 27% from a year ago. but it's still half of prepandemic levels mortgage rates pulled back the average rate on the 30-year fixed at 5.885 still nearly double what it was six months ago and combined with inflation, it's making it hard to afford just about everything and that will likely continue to cool the market. we did see the jump in adjustable rate loans because they do offer lower rates. >> and the m

. >> reporter: the chairman of lenar said rising rates are causing buyers to pause and wait >> it's naturalcker shock, pause, reconciliation at the end of the day, we have a housing shortage across the country. we're going to continue to build homes. >> reporter: miller added while the market has cooled, it has not stopped. some cities are faring better than others but giving any guidance about what to expect over the next several months, he said that would be more like guessing shep >> dye than olick. thanks bill cosby bill cosby sexually assaulted a 16-year-old girl at the play boy mansion in 1975. that's the verdict just announced from jurors in a civil trial in california. they found cosby caused harmful physical contact with judy huff. they said he knew she was a minor. the jury awarded huf half a million. cosby continues to deny the accusation the verdict comes nearly a year after they released bill cosby from prison after they threw out a separate criminal conviction for sexual assault. >>> people are hitting the road for the upcoming holiday weekend but will high gas prices and canc

. >> doc, dr horton, lenar make the list calls in both? >> yeah.iment or speed bump if you will, scott, is higher rates that consumers are having to pay for mortgages and so forth margins for homes are still sky high because the inventory is so low. again, supply and demand you have a lot more demand, even at higher prices that people have to pay on mortgages than you have a supply out there. i think both of those continue to benefit from that if we see a flattening of interest rates, which is one of the things i am hoping to see in the second half of the year, then i think these both work really well. >> you can see the full list of the cheapest stocks in the market according to our screen you can go to cnbc.com/proand find them there. >>> bank stocks down 10% one says reson recsiisk is not priced into that group priced into that group we'll debate it nextanted a streamlined version he could access anywhere, no download necessary. and kim. she wanted to execute a pre-set trade strategy in seconds. so we gave 'em thinkorswim® web. because platforms

level in 22 years b barkleys cutting the price target dr horton, we ran a screen on cnbc pro, and lenarhis news is not good because this leads to where home prices are typically going if you look at mortgage apps and demand. >> yep a lot of it got pulled forward, scott, when we obviously had the low rates. everybody was trying to get out of the city. great building was going on, people were excited about it this has never been about how cheap the builders are, it is what is the volume, are they able to get the profits. obviously as rates changed, that changed the demand picture in a big way. that's what we are struggling with now you go back three, four years ago, back to september of 2020, this is where d r horton was a lot of it was what was going on with rates but what was going on because of the pandemic and movement we were seeing. a lot of different things are in play it is still a good space to be in i will continue to hold this stock. i like the builders. you're right, it has gotten cheap, but cheap doesn't mean it is going higher. >> lower demand for houses can't be good for re

layoffs we heard about from compass, red fin and there will be more you see home building stocks dhi, lenar, nvr, pole tee, down between 5 and 8% today they're tiny stocks. those stocks don't matter at all to the calculation of the s&p 500. however, the product that they sell is enormously important when you lose that aspect of consumer confidence and spending, when the home they're in doesn't sell, when applications to buy new homes declines, a lot of ancillary spending in our economy goes away with that so you're probably going to have a bust frankly in durables if you bought a new washing machine in 2021, you're not buying one in 2022 obviously i think that that is really important because we talk about the transition of the economy. we're going to go from items to services that sounds great. thing is, services are very small in the s&p 500 earnings. durable goods and actual items are large. it is a relic of the way the indexes were constructed if you understand that the few remaining areas where there's consumer enthusiasm like travel are tiny for the earnings picture, then it is hard t

. >> because lenar and toll, they started trading at three and four times earnings. if you cut the earnings in half, they're very inexpensive i think that let's just get it over with. let's just get it over with. have mortgage rates gok to 6.5. >> we have a ten-year at 3.26% that was below 3 last week reminding people it has not been a great year to own bonds. if you have been in certain bond funds, you have had significant losses nowhere to hide. >> two-year is fine. >> whatert asset class could you hide in? not even gold? >> i like gold here. nowhere to hide is wrong because there's -- >> tell me >> the two-year, there's commodities in brazil. >> brazil, listen to me. we need pipe in this country the fact oil is down, we need the gas pipe, the europeans need the gas. >> you could have hid in energy without a doubt and been happy >> it's down today i think you buy energy because we don't have enough energy. this is very much like 1969, '71. you know, david, some people say exxon has more money than god. >> including our president >> this is what the president said o

we had some good news on housing this morning with lenar coming out with better-than-expected revenuetarts were down 14.4% last week, and this morning at 10 a.m., we will get the latest on existing home sales, jonathan , ryan, it's great to have you this morning. final thoughts, ryan? >> look, there's still a lot that want to buy houses, we've had a lot of blood in the streets, good prices in the market without bad news we've had a lot of it. it's time to buy here, maria. inflation is going to come down this year, the economy is still relatively strong. be bullish. maria: all right, you're a bull and sticking to it, jonathan? >> i concur with ryan. it's a good time to buy, especially here in parts of california. so i think it's a good outlook at this point and let's keep it going as strong as we can. hopefully the president will do what he needs to do to keep it going. maria: all right let me just point out that mike wilson is the chief strategist at morgan stanley this morning coming out with a report saying stocks have another 15-20% down to go. they are looking forward to climbs at