We may like to refer to them as the "beleaguered big builders," but in fact many of the top names in home building are sitting on piles and piles of cash.
One analyst recently flagged me to the fact that 12 of the public builders they cover (and these are the big ones) have an average of about $1.1 billion each.
Yes, they're still having trouble selling homes, and they're still not building many homes, but cash is king these days, or so the CEOs keep saying.
Looking at their futures, through 2013, the analyst says, these same builders together have just $6.5 billion of total debt coming due. "That will leave the builders with a cash balance of over $6 billion at end of 2013, assuming none of that debt is refinanced and the builders do not generate any incremental cash flow."
Where am I going with this?
You guessed it: The Net Operating Loss carryback extension, which is being tacked on to the extension of the first time home buyer tax credit. This would allow them to apply losses in 2008 and 2009 over the last five years and thereby gain even more cash. The question is, what would they do with that cash?