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Tickers in this Article: XHB, SPY, OC, SSD, USG
The homebuilders group is on the rise, and many are now rethinking their notions of a moribund American housing market. Moreover, a great many companies related to the homebuilding business have been moving higher, largely as a result of strong recent earnings and a substantial rise in expectations for the coming twelve months.



Below, we highlight some of the biggest companies in the homebuilding market - companies with great momentum and strong franchises.



IN PICTURES: 7 Tips On Buying A Home In A Down Market



Connecting Materials for Materialists


Simpson Manufacturing Co. (NYSE:SSD) manufactures a wide variety of products employed in the residential and commercial building trades. That includes wood-to-wood, wood-to-concrete and wood-to-masonry connectors and a host of venting products for fuel burning appliances among other things. Simpson shares are up 60% in the last year, slightly better than the 55% rise in the SPDR S&P Homebuilders ETF (NYSE:XHB).



SSD trades with a nominal dividend yield of 1.31% per annum and a one-year trailing P/E ratio of 122.5. And while that may look alarming, it should be stressed that the number reflects dismal earnings in the first half of 2009. With the recovery well underway and building starts expected to rise, SSD's current earnings multiple should shrink considerably.



Climbing a Wall of Losses?


USG Corporation (NYSE:USG) is also a retailer of building supplies to the nation's contractors, specializing in gypsum walls and ceilings. The company's stock has gained 95% in the last year, despite negative earnings. Price to sales on the shares is currently a very competitive 0.6.



USG stock is one of the fastest rising NYSE issues in the last 60 days, climbing over 60% in that period.



Owens Corning (NYSE:OC) is one of the building trades oldest and most innovative companies and now has a market cap in excess of $3.5 billion. The company invented and produces, among other products, glass fiber reinforcements (fiberglass) used in the residential and commercial construction industries.



Owens Corning shares are up 155% in a year, better than the SPDR S&P 500 ETF (NYSE:SPY), which has gained 42% in that time frame.



The Wrap


Don't count the homebuilders out yet. Along with the suppliers and associated peripheral businesses, homebuilders have been very strong performers since the year began. And the above three have stormed to the top of the market. (For more, see Measuring The Benefits Of Home Ownership.)



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