Shares of Hovnanian Enterprises Inc. /zigman2/quotes/203952761/composite HOV +0.21% surged 6.4% toward a fifth-straight gain in morning trading Wednesday, after the home builder reported fiscal second-quarter earnings that more than tripled, when excluding the benefit of last year's valuation allowance reduction, and gross margin that improved by more than five percentage points. Net income for the quarter to April 30 was $59.8 million, or $8.39 a share, after income of $488.7 million, or $69.65 a share, in the year-ago period. Excluding the $468.6 million benefit of the valuation allowance reduction, net income was $20.0 million, or $2.85 a share, in last year's second quarter. There are no analysts surveyed by FactSet to provide Wall Street expectations. Revenue slipped 0.1% to $702.5 million, while consolidated contract dollars increased 4.9% to $860.5 million. Costs and expenses declined 8.4% as home building gross margin improved to 23.3% from 18.1%. For the third quarter, Hovnanian expects revenue to be between $780 million and $830 million. The stock, which has soared 31.8% over the past five sessions, has still plunged 57.2% year to date, while the iShares U.S. Home Construction ETF /zigman2/quotes/203468436/composite ITB -0.49% has dropped 27.0% and the S&P 500 /zigman2/quotes/210599714/realtime SPX -0.16% has lost 12.7%.