Green Builders in Georgetown, Texas – great home, bad stock

After I bought my Green Builders home, I also purchased some of their company stock.  It’s an expensive way to force me to pay attention to any financial news regarding the builder.  Same thing for my gym membership.  If I don’t pay, I just won’t exercise.

Today I ran across an article that gave me reason to sell all of my shares:

Green Builders gets delisting notice
January 29, 2009 6:14 PM ET

from bizjournals.com

nyse

Green Builders Inc. could be removed from the stock exchange its been trading on if it doesn’t regain compliance with listing rules.

The Austin-based homebuilder said it’s received a notice from NYSE Alternext US, formerly the American Stock Exchange, that the company is currently noncompliant with rules and has until Feb. 23 to submit a plan outlining how it will regain compliance by July.

According to Green Builders (NYSE Alternex US: GBH) the exchange, in explaining its decision, cited the fact that the company’s stockholder equity is less than $2 million and the company has sustained losses from continuing operations and net losses in two of its three most-recent fiscal quarters. Furthermore, the exchange said that the company’s losses are so substantial in relation to its overall operations or financial resources, that it appears questionable to the exchange whether the company will be able to continue to operate or meet its obligations.

The company said it will explore all of its options and has not made a decision whether or not it will submit a plan to continue to trade on the exchange. For now Green Builders continues to trade on the exchange.

Ouch, so what does that mean for the builder?  Hopefully that won’t affect their ability to operate in Georgetown Village.  I would think that the only thing that changes is their ability to raise money through their shareholders.  However, I’m no financial guru.  It’s an obvious fact that the stronger the financials of a builder, the more likely they’ll stick around and net losses in two of its three most recent fiscal quarters doesn’t sound very promising.  It would probably be harder for the company to borrow money and So what’s your prediction?  Do you think they’ll stay or go?

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