Switch to:

GuruFocus Financial Strength Rank measures how strong a company’s financial situation is. It is based on these factors

1. The debt burden that the company has as measured by its Interest coverage (current year).
2. Debt to revenue ratio. The lower, the better
3. Altman Z-score.

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

Financial Strength : 7/10

vs
industry
vs
history
Cash to Debt 0.15
TPH's Cash to Debt is ranked lower than
59% of the 920 Companies
in the Global Residential Construction industry.

( Industry Median: 1.28 vs. TPH: 0.15 )
TPH' s 10-Year Cash to Debt Range
Min: 0.01   Max: 1.48
Current: 0.15

0.01
1.48
Equity to Asset 0.50
TPH's Equity to Asset is ranked higher than
63% of the 629 Companies
in the Global Residential Construction industry.

( Industry Median: 0.48 vs. TPH: 0.50 )
TPH' s 10-Year Equity to Asset Range
Min: 0.42   Max: 0.88
Current: 0.5

0.42
0.88
Z-Score: 2.61
WACC vs ROIC
12.41%
4.99%
WACC
ROIC
GuruFocus Profitability Rank ranks how profitable a company is and how likely the company’s business will stay that way. It is based on these factors:

1. Operating Margin
2. Trend of the Operating Margin (5-year average). The company with an uptrend profit margin has a higher rank.
••3. Consistency of the profitability
4. Piotroski F-Score
5. Predictability Rank•

The maximum rank is 10. A rank of 7 or higher means a higher profitability and may stay that way. A rank of 3 or lower indicates that the company has had trouble to make a profit.

Profitability Rank is not directly related to the Financial Strength Rank. But if a company is consistently profitable, its financial strength will be stronger.

Profitability & Growth : 3/10

vs
industry
vs
history
Operating margin (%) 9.63
TPH's Operating margin (%) is ranked higher than
87% of the 923 Companies
in the Global Residential Construction industry.

( Industry Median: 2.96 vs. TPH: 9.63 )
TPH' s 10-Year Operating margin (%) Range
Min: -23.66   Max: 8.64
Current: 9.63

-23.66
8.64
Net-margin (%) 4.93
TPH's Net-margin (%) is ranked higher than
80% of the 924 Companies
in the Global Residential Construction industry.

( Industry Median: 2.13 vs. TPH: 4.93 )
TPH' s 10-Year Net-margin (%) Range
Min: -23.76   Max: 4.94
Current: 4.93

-23.76
4.94
ROE (%) 7.27
TPH's ROE (%) is ranked higher than
69% of the 876 Companies
in the Global Residential Construction industry.

( Industry Median: 6.16 vs. TPH: 7.27 )
TPH' s 10-Year ROE (%) Range
Min: -37.5   Max: 7.48
Current: 7.27

-37.5
7.48
ROA (%) 3.56
TPH's ROA (%) is ranked higher than
72% of the 935 Companies
in the Global Residential Construction industry.

( Industry Median: 2.33 vs. TPH: 3.56 )
TPH' s 10-Year ROA (%) Range
Min: -14.05   Max: 3.49
Current: 3.56

-14.05
3.49
ROC (Joel Greenblatt) (%) 9.70
TPH's ROC (Joel Greenblatt) (%) is ranked higher than
72% of the 932 Companies
in the Global Residential Construction industry.

( Industry Median: 6.14 vs. TPH: 9.70 )
TPH' s 10-Year ROC (Joel Greenblatt) (%) Range
Min: -32.49   Max: 8.85
Current: 9.7

-32.49
8.85
» TPH's 10-Y Financials

Financials


Revenue & Net Income
Cash & Debt
Oprt. Cash Flow & Free Cash Flow

» Details

Guru Trades

Q2 2014

TPH Guru Trades in Q2 2014

Louis Moore Bacon 325,000 sh (New)
Paul Tudor Jones 33,300 sh (New)
Manning & Napier Advisors, Inc 129,857 sh (New)
Murray Stahl 2,062,295 sh (New)
Chuck Royce 786,172 sh (+21.76%)
John Keeley 2,965,068 sh (+5.86%)
Louis Moore Bacon 100,000 sh (unchged)
Steven Cohen 2,577,000 sh (unchged)
Steven Cohen 1,732,094 sh (unchged)
Jim Simons Sold Out
Ron Baron Sold Out
» More
Q3 2014

TPH Guru Trades in Q3 2014

HOTCHKIS & WILEY 1,526,806 sh (New)
Ken Heebner 1,000,000 sh (New)
Murray Stahl 5,513,594 sh (+167.35%)
Louis Moore Bacon 800,000 sh (+146.15%)
Manning & Napier Advisors, Inc 286,371 sh (+120.53%)
Paul Tudor Jones 59,571 sh (+78.89%)
Chuck Royce 851,172 sh (+8.27%)
John Keeley 3,085,653 sh (+4.07%)
Steven Cohen 241,700 sh (-90.62%)
» More
Q4 2014

TPH Guru Trades in Q4 2014

David Einhorn 4,408,647 sh (New)
NWQ Managers 2,387,164 sh (New)
HOTCHKIS & WILEY 3,243,416 sh (+112.43%)
Steven Cohen 397,400 sh (+64.42%)
Ken Heebner 1,550,000 sh (+55.00%)
Chuck Royce 1,147,872 sh (+34.86%)
Murray Stahl 7,126,897 sh (+29.26%)
John Keeley 3,398,173 sh (+10.13%)
Steven Cohen 428,097 sh (+7.72%)
John Keeley 3,399,053 sh (+0.03%)
Manning & Napier Advisors, Inc 286,371 sh (unchged)
Paul Tudor Jones 39,220 sh (-34.16%)
Louis Moore Bacon 50,000 sh (-93.75%)
» More
Q1 2015

TPH Guru Trades in Q1 2015

Manning & Napier Advisors, Inc 341,660 sh (+19.31%)
» More
» Details

Insider Trades

Latest Guru Trades with TPH

(List those with share number changes of more than 20%, or impact to portfolio more than 0.1%)

No Entry found in the selected group of Gurus. You can
  • 1. Modify your Personalized List of Gurus, or
  • 2. Click on Premium Premium Tools above to check out all the Gurus, or
  • 3. Click on Premium Plus Premium Plus above for the stocks picks of all the institutional investment advisors (>4000)
» Interactive Charts

Peter Lynch Chart ( What is Peter Lynch Charts )

Guru Investment Theses on TRI Pointe Homes Inc

Murray Stahl’s Horizon Kinetics Comments on TRI Pointe Homes - Jul 25, 2014

TRI Pointe Homes (TPH) is a recent addition to some of our portfolios. It was founded in the depths of the Credit Crisis in 2009 by former homebuilding industry executives. Their objective was to acquire land lots in distressed regions, particularly in California and Colorado, which could be utilized for future home construction. TRI Pointe was certainly not alone. A number of companies led by astute investors acquired enormous amounts of land in heavily distressed areas such as California, Arizona, and Nevada.

In 2010, real estate investor Barry Sternlicht capitalized TRI Pointe with $150 million of equity through his Starwood Capital private equity fund. Mr. Sternlicht became Chairman of TRI Pointe and received roughly 39% equity ownership of the company. Given his real estate experience, it is not surprising that he chose a vehicle that will ultimately benefit from a sustained recovery in the residential housing market.

TRI Pointe drew upon the entire $150 million infusion, using the proceeds to acquire lots in California and Colorado. As a result, it expanded rapidly, increasing its revenues from $14 million in 2011 to $247 million in 2013.

While seemingly on a rapid growth trajectory, Mr. Sternlicht chose to accelerate the company’s expansion through the just-completed merger with the homebuilding operations of Weyerhaeuser (Weyerhaeuser Real Estate Company, or WRECO), which closed July 8th. WRECO’s homebuilding operations were considerably larger than those of TRI Pointe, such that in terms of revenues and market capitalization, TRI Pointe has become one of the ten largest homebuilders in the U.S.

The transaction was structured as an equity offering by TRI Pointe for the assets of WRECO, increasing the company’s shares outstanding from 31.6 million to 162.9 million; thus, the market capitalization has just expanded from less than $500 million to $2.5 billion. This could be an important catalyst for the shares, although not fundamental in nature whatsoever. TRI Pointe was rather illiquid, as Starwood owned nearly 40% of the shares outstanding, leaving a float-adjusted market capitalization of under $300 million. The enhanced trading liquidity could eventually attract the interest of the ETF index engineers.

Nevertheless, TRI Pointe is currently priced in a manner reflective only of present earnings power, not of its substantial land bank. That is, investors are unwilling to pay a premium for the vast optionality that exists in the company’s largest market, California. To illustrate, the consensus revenue estimate in 2015, which incorporates the contribution of WRECO, is $2.77 billion. Based on an historical average for the industry, TRI Pointe should manage to earn a profit margin of perhaps 7.9% in a reasonably robust housing market. This would create $219 million of net income, and a $2.6 billion market capitalization using a 12x p/e multiple. This is only slightly higher than the current pro forma market capitalization of $2.5 billion.

However, homebuilding activity in California is still 74% below the normal average in that state. A return to a normal level would entail construction activity more than three times the current rate. As over half of TRI Pointe’s land lots are in California, an eventual recovery in this market would have a great impact on its earnings. Moreover, broad construction levels in the U.S. are still well below normal levels. The addition of WRECO exposes TRI Pointe to other markets as well, such as Washington D.C. and Texas. The company therefore is positioned to participate in a much broader recovery.

Yet, given the fact that this presumed expansion in the company’s earnings cannot be precisely estimated, this optionality is being discounted by investors at a very high rate. To evidence this, based on the company’s own projections, WRECO as a standalone entity could produce over $200 million of net income by 2016. If investors were willing to pay a multiple of 12x this estimate, the resulting market capitalization of over $2.4 billion would about equal the current implied market capitalization of TRI Pointe. In other words, at this price one is not paying for the entire TRI Pointe stub business, which should report nearly $500 million of revenues this year.

Importantly, TRI Pointe has the benefit of a key intangible asset that does not appear on its financial statements and thus cannot be traditionally valued. Mr. Sternlicht is an experienced, well known, and serially successful real estate investor. He therefore has access to strategic information within the industry that the average executive does not. It appears that he is using TRI Pointe as a new investment vehicle.

From Murray Stahl (Trades, Portfolio)’s Horizon Kinetics Second Quarter 2014 Commentary.

Check out Murray Stahl latest stock trades

Top Ranked Articles about TRI Pointe Homes Inc

5 Stocks Multiple Gurus Are Buying
One of GuruFocus’ useful features is the Consensus Picks of Gurus page, which lists stocks that have been bought or sold by multiple gurus. Read more...
Murray Stahl’s Horizon Kinetics Comments on TRI Pointe Homes
TRI Pointe Homes (TPH) is a recent addition to some of our portfolios. It was founded in the depths of the Credit Crisis in 2009 by former homebuilding industry executives. Their objective was to acquire land lots in distressed regions, particularly in California and Colorado, which could be utilized for future home construction. TRI Pointe was certainly not alone. A number of companies led by astute investors acquired enormous amounts of land in heavily distressed areas such as California, Arizona, and Nevada. Read more...

Ratios

vs
industry
vs
history
P/E(ttm) 21.90
TPH's P/E(ttm) is ranked higher than
73% of the 1176 Companies
in the Global Residential Construction industry.

( Industry Median: 99.10 vs. TPH: 21.90 )
TPH' s 10-Year P/E(ttm) Range
Min: 20.81   Max: 132.27
Current: 21.9

20.81
132.27
Forward P/E 11.90
TPH's Forward P/E is ranked higher than
92% of the 1176 Companies
in the Global Residential Construction industry.

( Industry Median: 0.00 vs. TPH: 11.90 )
N/A
PE(NRI) 22.80
TPH's PE(NRI) is ranked higher than
74% of the 1176 Companies
in the Global Residential Construction industry.

( Industry Median: 109.90 vs. TPH: 22.80 )
TPH' s 10-Year PE(NRI) Range
Min: 20.68   Max: 130.23
Current: 22.8

20.68
130.23
P/B 1.60
TPH's P/B is ranked higher than
60% of the 1176 Companies
in the Global Residential Construction industry.

( Industry Median: 1.70 vs. TPH: 1.60 )
TPH' s 10-Year P/B Range
Min: 0.67   Max: 2.09
Current: 1.6

0.67
2.09
P/S 1.25
TPH's P/S is ranked higher than
53% of the 1176 Companies
in the Global Residential Construction industry.

( Industry Median: 0.92 vs. TPH: 1.25 )
TPH' s 10-Year P/S Range
Min: 1.08   Max: 5.81
Current: 1.25

1.08
5.81
EV-to-EBIT 28.67
TPH's EV-to-EBIT is ranked higher than
71% of the 1176 Companies
in the Global Residential Construction industry.

( Industry Median: 108.49 vs. TPH: 28.67 )
TPH' s 10-Year EV-to-EBIT Range
Min: -15.1   Max: 129.5
Current: 28.67

-15.1
129.5
Current Ratio 4.46
TPH's Current Ratio is ranked higher than
88% of the 634 Companies
in the Global Residential Construction industry.

( Industry Median: 1.79 vs. TPH: 4.46 )
TPH' s 10-Year Current Ratio Range
Min: 3.14   Max: 20.91
Current: 4.46

3.14
20.91
Quick Ratio 0.34
TPH's Quick Ratio is ranked lower than
69% of the 634 Companies
in the Global Residential Construction industry.

( Industry Median: 0.99 vs. TPH: 0.34 )
TPH' s 10-Year Quick Ratio Range
Min: 0.26   Max: 2.32
Current: 0.34

0.26
2.32
Days Inventory 505.37
TPH's Days Inventory is ranked lower than
53% of the 1176 Companies
in the Global Residential Construction industry.

( Industry Median: 114.71 vs. TPH: 505.37 )
TPH' s 10-Year Days Inventory Range
Min: 306.1   Max: 779.88
Current: 505.37

306.1
779.88
Days Sales Outstanding 2.80
TPH's Days Sales Outstanding is ranked higher than
98% of the 1176 Companies
in the Global Residential Construction industry.

( Industry Median: 68.95 vs. TPH: 2.80 )
TPH' s 10-Year Days Sales Outstanding Range
Min: 1.34   Max: 2.55
Current: 2.8

1.34
2.55

Valuation & Return

vs
industry
vs
history
Price/Tangible Book 1.80
TPH's Price/Tangible Book is ranked higher than
60% of the 1176 Companies
in the Global Residential Construction industry.

( Industry Median: 1.90 vs. TPH: 1.80 )
TPH' s 10-Year Price/Tangible Book Range
Min: 1.48   Max: 2.09
Current: 1.8

1.48
2.09
Price/Median PS Value 0.70
TPH's Price/Median PS Value is ranked higher than
89% of the 1176 Companies
in the Global Residential Construction industry.

( Industry Median: 1.40 vs. TPH: 0.70 )
TPH' s 10-Year Price/Median PS Value Range
Min: 0.77   Max: 1.36
Current: 0.7

0.77
1.36
Price/Graham Number 1.50
TPH's Price/Graham Number is ranked higher than
79% of the 1176 Companies
in the Global Residential Construction industry.

( Industry Median: 0.00 vs. TPH: 1.50 )
TPH' s 10-Year Price/Graham Number Range
Min: 1.58   Max: 1.58
Current: 1.5

Earnings Yield (Greenblatt) 3.50
TPH's Earnings Yield (Greenblatt) is ranked higher than
61% of the 917 Companies
in the Global Residential Construction industry.

( Industry Median: 4.70 vs. TPH: 3.50 )
TPH' s 10-Year Earnings Yield (Greenblatt) Range
Min: 0.8   Max: 3.8
Current: 3.5

0.8
3.8

Business Description

Industry: Homebuilding & Construction » Residential Construction
Compare: » details
Traded in other countries:T86.Germany,
TRI Pointe Homes Inc is engaged in the design, construction and sale of single-family homes in planned communities in metropolitan areas located throughout Southern and Northern California, and Colorado.
» More Articles for TPH

Headlines

Articles On GuruFocus.com
5 Stocks Multiple Gurus Are Buying Mar 05 2015 
William Lyon Homes Bags Profits In Its Q4 Earnings Feb 24 2015 
TRI Pointe Homes Colorado Division Wins Three Awards at The Nationals Jan 28 2015 
Extended Hours at Barrington, Open Until 8 PM, This Weekend Only Nov 13 2014 
Buy Now Save Big at Barrington in Scenic Brentwood on Impressive Move-In Ready Homes Oct 30 2014 
Murray Stahl’s Horizon Kinetics Comments on TRI Pointe Homes Jul 25 2014 
Weekly 3-Year Low Highlight: GGB, XOOM, TPH, JCS May 21 2013 

More From Other Websites
Pardee Homes Chooses Millennial Designer Bobby Berk As Creative Director For Innovative Concept... Apr 16 2015
TRI POINTE HOMES, INC. Files SEC form 8-K/A, Completion of Acquisition or Disposition of Assets,... Apr 15 2015
TRI Pointe Group Announces President of TRI Pointe Connect Apr 09 2015
TRI Pointe Group Announces President of TRI Pointe Connect Apr 09 2015
TRI Pointe Homes, Inc. Announces First Quarter 2015 Earnings Release and Conference Call Date Apr 08 2015
TRI Pointe Group, Inc. Announces First Quarter 2015 Earnings Release and Conference Call Date Apr 06 2015
TRI Pointe Group, Inc. Announces First Quarter 2015 Earnings Release and Conference Call Date Apr 06 2015
TRI POINTE HOMES, INC. Financials Mar 19 2015
TRI POINTE HOMES, INC. Files SEC form 10-K, Annual Report Mar 12 2015
TRI POINTE HOMES, INC. Files SEC form 8-K, Change in Directors or Principal Officers, Financial... Mar 11 2015
TRI Pointe Homes Colorado Launches New Lending Service, TRI Pointe Connect, in Colorado Mar 10 2015
TRI Pointe Homes Colorado Launches New Lending Service, TRI Pointe Connect, in Colorado Mar 10 2015
TRI POINTE HOMES, INC. Files SEC form 8-K, Change in Directors or Principal Officers Mar 05 2015
Louisiana-Pacific Down to Strong Sell on Weak Q4 Results - Analyst Blog Mar 04 2015
Will The Cooper Companies (COO) Surprise Earnings in Q1? - Analyst Blog Mar 03 2015
KB Home (KBH) Opens Single-Family Homes in San Antonio - Analyst Blog Mar 03 2015
TRI Pointe Homes (TPH) Stock Declines Today on Lowered Outlook Mar 03 2015
TRI POINTE HOMES, INC. Files SEC form 8-K, Results of Operations and Financial Condition, Financial... Mar 03 2015
Tri Pointe Cuts Outlook, Notes Houston Uncertainty Mar 03 2015
TRI Pointe Homes, Inc. Reports 2014 Fourth Quarter and Full Year Results Mar 03 2015
Tri Pointe beats 4Q profit forecasts Mar 03 2015
Tri Pointe beats 4Q profit forecasts Mar 03 2015
Q4 2014 Tri Pointe Homes Inc Earnings Release - Before Market Open Mar 03 2015
TRI Pointe Homes, Inc. Reports 2014 Fourth Quarter and Full Year Results Mar 03 2015
TRI Pointe Homes Rebrands to TRI Pointe Group Reflecting the New National Family of Premium... Mar 02 2015
TRI Pointe Homes Offers Enticing Value Amid Construction Rebound Mar 02 2015
Quadrant Homes Launches New Lending Service, TRI Pointe Connect, in Seattle Mar 02 2015
Can Violin Memory (VMEM) Surprise this Earnings Season? - Analyst Blog Mar 02 2015
Can JD.com (JD) Surprise Estimates this Earnings Season? - Analyst Blog Mar 02 2015
TRI Pointe Homes Celebrating Community Grand Opening February 28th to Spotlight Brentwood's Sweet... Feb 27 2015
First Sales Release This Saturday, November 22nd At Ventana in Tracy Nov 21 2014
TRI Pointe to Webcast Analyst and Investor Day Event Nov 14 2014
Just Four Months After One of the Largest Mergers in Homebuilding History, TRI Pointe Expands with... Nov 06 2014
Tri Pointe posts 3Q profit Nov 06 2014
TRI Pointe Homes to Host Third Quarter 2014 Earnings Webcast and Conference Call Oct 21 2014
Weyerhaeuser to spin off real estate business May 12 2014

Personalized Checklist

Checklist has been moved to "Checklist" tab.

Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
FEEDBACK