Fitch rates Hovnanian notes BB+

Fitch Ratings said it has assigned a BB+ rating to Hovnanian Enterprises Inc.'s $150 million 6.375% senior notes due Dec. 15, 2014.

The outlook is stable.

Fitch said ratings for Hovnanian are based on the company's successful execution of its business model, conservative land policies and geographic, price point and product line diversity. The company has been an active consolidator in the homebuilding industry which has led to above-average growth during the past six years, but has kept debt levels somewhat higher than its peers.

Management has also exhibited an ability to quickly and successfully integrate its acquisitions. In any case, now that the company has reached current scale there may be less use of acquisitions going forward and acquisitions are likely to be smaller relative to Hovnanian's current size, the agency said.

Risk factors include the inherent (although somewhat tempered) cyclicality of the homebuilding industry. The ratings also manifest the company's aggressive, yet controlled growth strategy and Hovnanian's capitalization and size.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.