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Shares of Mobile Home Firms Rise

Fallout from Hurricane Charley in Florida could boost business. Orange juice futures climb.

August 17, 2004|From Reuters and Bloomberg News

Shares of mobile home manufacturers soared Monday on the hope that business would increase after the destruction Hurricane Charley wreaked in Florida over the weekend.

In commodities trading, orange juice futures posted their biggest one-day gain in three years on concerns about damage to some citrus orchards.

Among manufactured-housing stocks, Riverside-based Fleetwood Enterprises Inc. scored the sector's biggest gain, surging $1.24, or 11.4%, to $12.10 on the New York Stock Exchange.

Also rising sharply were Ocala, Fla.-based Nobility Homes Inc., up $2.08, or 11%, to $20.97 on Nasdaq; Champion Enterprises Inc. of Auburn Hills, Mich., up 98 cents, or 10.7%, to $10.16 on the NYSE; and Palm Harbor Homes Inc. of Addison, Texas, up 73 cents, or 4.7%, to $16.23 on Nasdaq.

Nobility Homes Chairman Terry Trexler said if the fallout from Charley was similar to the damage inflicted by Hurricane Andrew in 1992, his company could see a sales boost.

"We know that our owned model centers will probably see an influx of business from people moving up," Trexler said. "Typically it will last six to nine months. It won't be a short period of time because it takes a while for all these things to happen."

Florida is virtually the company's only market. Nobility had sales of $23.3 million in its fiscal first half ended May 1. That was up 38% from a year earlier. Earnings were up 34% to 47 cents a share.

Nobility is "already doing very well in terms of year-over-year sales," said Art Havener, an analyst at brokerage A.G. Edwards & Sons in St. Louis. "I think this one is going to help incrementally."

Barbara Allen, an analyst at Natexis Bleichroeder in New York, downplayed the significance of post-hurricane rebuilding on overall quarterly results for the bigger manufactured-housing companies.

"It's so irrelevant to a national company's earnings," she said. "I have never in my career seen a hurricane have anywhere close to a measurable impact on anybody's earnings."

Shares of recreational vehicle makers also jumped Monday. Winnebago Industries Inc. leaped $1.86, or 6.4%, to $30.93 on the NYSE, and Thor Industries Inc. of Jackson Center, Ohio, rose $1.10, or 4.3%, to $26.80 on the NYSE.

In commodities markets, orange juice futures for November delivery rose the exchange limit of 5 cents, or 7.9%, to 68 cents a pound on the New York Board of Trade, the biggest gain since July 2001.

Juice futures hit a 27-year low of 55 cents a pound in May, hurt by prospects of a huge Florida crop just as the popularity of low-carbohydrate diets was reducing juice demand.

But the hurricane ripped some trees out of the ground and probably caused the most crop damage since Hurricane Donna in 1960, said Bob Terry of the U.S. Department of Agriculture.

DeSoto, Polk and Hardee counties were hit hardest, he said. They produced almost a third of the 203 million boxes of oranges the state sold last year, government figures showed.

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