Bob Toll is painting a different picture of the housing market, Cramer said during Stop Trading!, than much of the national data we’ve recently seen. “Underwater” homes and constant foreclosures don’t seem to jive with the increased traffic the Toll Brothers CEO mentioned on his latest conference call.
Last week, Toll Brothers , which deals in luxury real estate, announced that quarterly net signed contracts were up for the first time in four years, reports said, while cancellations were at their lowest point since the second quarter of 2006. The company also spoke of increased demand in hard-hit areas like Orlando, Fla., and other markets that Cramer thought were “dead.” Toll’s statements stood in contrast to the generally negative sentiment held toward housing right now.
“The big macro data has to be balanced,” Cramer said, “with what Bob Toll said.”
Cramer pointed to Toll Brothers’ increasing liquidity, that drop in cancellations and the change in traffic. Potential buyers have widened their focus from just price point to include a range of amenities, which they wouldn’t have done when the recession was at its worst.
Lastly, Citigroup’s stock won’t pullback, Cramer said, “because it’s working and cheap.” He recently put a $6 price target on Citi, predicting it would happen within the next 18 months.
Watch the video for Cramer’s take on why value’s making a comeback in the US and how that has boosted companies like LEGO.
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