主题：搞一个飞人推荐的股票扑周报，就当纸上炒股的周记…… -- 古狗肥腩死

Let's look at the great qualities that separate Hovnanian from the rest of the housing market:

Debt/Equity Ratio last quarter:

HOV: 1.4

Industry: .79

This means Hovnanian has 1.4 times more long-term debt than equity, twice as much as the industry average.

Cash Flow/Long Term Debt ratio:

.078

This means Hovnanian generates free cash flow that is equivalent to 7.8% of its long-term debt.

Interest Coverage (EBIT/Interest Expense):

-34.77/6.67 = -5.2

This means that Hovnanian is losing 5.2 times more money than it owes on interest payments.

Interest Expense over the last 5 quarters:

Q2 2006: 0.70

Q3 2006: 0.65

Q4 2006: 1.45

Q1 2007: 1.22

Q2 2007: 6.67

This means that somehow, Hovnanian managed to increase its interest payments to 6.67 million, up from just 1.22 million the previous quarter, an increase that is 5.46 times higher.

Let's have a look at cash, where all figures are obtained from thestreet.com. Last quarter, Hovnanian had $19.5 million in cash. It also had interest payments of 6.67 million, included in total loss of $30.73 million. This means that the company will have to severely cut equity (essentially by liquidating houses by selling them at lower prices), to generate enough cash flow to stay afloat. When this happens, Hovnanian will have reduced assets that were claimed as collateral for its debt.

Let's isolate interest payments to cash, and pretend losses don't exist for a moment. If Hovnanian has to pay $6.67 million or more for the next three quarters, that is a total of at least $20.01 million. But, last quarter it only had $19.5 million in cash. This means Hovnanian barely has enough cash to stay afloat for the next three quarters, without even considering the continuation of losses.

So, how will it stay afloat? There are several options. First, it can raise capital by selling the stock in its treasury account, which has currently 12.39 million shares. There are currently 47.5 million traded shares outstanding. So, if they had to sell all 12.39 million, they would dilute the shares by 26% of their current value.

看样子，HOV 还要降。