Home-builder hammered by fears of a bubble; Hovnanian shares' multiyear rise runs into concerns over housing market.(In the Markets)

Crain's New York Business, August, 2005

Byline: Aaron Elstein Over the last five years, Hovnanian Enterprises Inc. has been a veritable home-run derby for its shareholders. Last month, shares of the big house-builder hit a record $73.20, more than 20 times the $3 they fetched in 2000. But just like the housing market's rise, Hovnanian's long run looks like it may be coming to an end.

In the last month, shares in the Red Bank, N.J.-based company have rapidly retreated, closing on Friday at $56.75. Investors should expect the rout to continue. Jocelynn Drake, an analyst at Schaeffer's Investment Research, predicts that the stock will soon fall to $50 a share. Pressure is already building as shares of Hovnanian and other builders attract short sellers, investors who promise to sell shares they...

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