August housing starts hold at 891,000 rate
Housing starts data released Wednesday morning shows a lull in housing construction, as the pace of residential construction showed a less-than-1% gain in August.
The official seasonally adjusted annual rate (SAAR) of housing starts in August was 891,000, up 0.9% above the downwardly revised July estimate of 883,000. Total housing starts are up 19.0% compared to the August 2012 rate.
Analysts had expected total starts to comfortably exceed the 900,000 mark.
Single-family starts, the bread-and-butter metric for a majority of LBM dealers, fared better — increasing 7.0% to a SAAR of 628,000. Compared to a year ago, single-family starts increased 16.9%.
The data from the U.S. Census Bureau and the Department of Housing and Urban Development shows growth of single-family construction strongest in the West, which recorded a17.5% month-to-month increase.
Building permits were also mixed. Authorizations were at a SAAR of 918,000, down 3.8% from the July rate — but up 11.0% from the August 2012 rate.
Fitch Ratings adjusts ratings following the Sherwin-Williams/Comex acquisition
Fitch Ratings has released its assessment of Sherwin-Williams’ completed acquisition deal with Comex, citing the move’s strategic value and offering an explanation of its adjusted ratings for the company, which it had downgraded from A to A- in May due to the inherent risk of the large transaction.
"Fitch believes that the acquisition of the U.S./Canadian operations has good strategic rationale for SHW," read a company statement. "The acquisition augments its current business mix and provides the company with a meaningful controlled distribution platform in the western U.S. and Canada, where its store count is currently low."
As it stands, the current Fitch Ratings for SHW reflect a Stable Outlook, with an A- for long-term IDR, senior unsecured notes and unsecured bank credit facilities. Short-term IDR and commercial paper are rated F2.
Current ratings are contingent on the company’s receipt of regulatory approval from the Federal Competition Commission of Mexico regarding its acquisition of Comex’s Mexico operations. In the event the acquisition falls through, Fitch will reassess the ratings.
The transaction was initially proposed last November for a pricetag of $2.34 billion, but the actual purchase price came in at $90 million with $75 million in assumed liabilities.