Fleetwood Enterprises Inc. plans to hire more than 1,000 new workers over the next 12 months because of strong demand for its RVs and because its long-slumping manufacturing housing business is improving.
So far this year, Fleetwood has added 400 workers mainly in the Southeast, according to Kathy Munson, director of investor relations. The 1,000 new employees to be hired over the next 12 months will work at plants in Georgia, North Carolina, Indiana, Florida and Texas.
The news that Fleetwood planned to hire more workers may have contributed to the sharp rise in Fleetwood’s stock price in New York Stock Exchange trading on Thursday (July 3).
Fleetwood shares soared $2.25, or 27%, to close at $10.45, the stock’s highest level in two years. Also, 1.2 million Fleetwood shares changed hands during the abbreviated trading session on Thursday, while on a typical trading day, 250,000 Fleetwood shares change hands, Munson said.
Munson said the reason for Fleetwood’s sharp stock price rise on Thursday quite possibly was because short sellers were covering. Short sellers are speculators who borrow stock from a broker or fund manager and then sell it, hoping the stock price will go down, so they can buy shares at a lower price before giving them back to the lender.
Apparently, on Thursday, many short sellers came to believe Fleetwood’s stock price would begin to rise, so they bought shares, helping create a feeding frenzy that pushed the stock price higher.
As of last week, about 40% of all of the Fleetwood stock that normally is available for trading was held by short sellers, Munson said.
Another recent development that may have created a brighter outlook for Fleetwood stock was the announcement on June 30 by Minneapolis-based U.S. Bank, the nation’s eighth largest bank, that it would begin offering loans on manufactured homes, Munson added.
For months, Fleetwood executives said the demand for manufactured homes was relatively healthy but a lack of lenders was preventing the industry from recovering.
Fleetwood has not yet issued its financial report for its fourth fiscal quarter, which ended on April 27. However, company officials said earlier the firm would not return to profitability during the February-through-April quarter.
Fleetwood plans to issue its fourth-fiscal-quarter and full-fiscal-year 2003 financial report around July 17, Munson said.
For the 39 weeks ended Jan. 26, Fleetwood reported a net loss of $15.3 million on sales of $1.75 billion.
For the November-through-January quarter, typically Fleetwood’s worst because of the RV and manufactured housing industry’s seasonal cycles, the company reported a net loss of $18.4 million, wiping-out the net profit it had earned during earlier quarters.