Wait for Earnings Before Pulling Trigger on Homebuilder Stocks (XHB) - Analyst

SPDR S&P Homebuilders ETF (NYSE: XHB) is down over 8 percent in the past week. On a longer-term basis analysts at Williams Financial think there is an excellent buying opportunity in this sector, but they warn that it could be foolish to step in front of a downward trending market until more visibility is seen.

Analysts are cautious about homebuilder stocks and fear that negative headlines could cause an unexpected rise in cancellation rates. They are looking forward to earnings reports from companies like Hovnanian Enterprises Inc. (NYSE: HOV) due out this Wednesday, June 6th. HOV earnings will be followed up by earnings reports from Lennar Corp. (NYSE: LEN) and KB Home (NYSE: KBH). Until then, investing in homebuilders is probably a shot in the dark.

Company earnings can be tracked at EPS Insider.

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