Masco Corporation (NYSE: MAS), Taylor, Mich., on Monday reported a net profit of $55 million ($0.15 per share) for its second quarter ended June 30, 2009. The profit "easily blew past very minimal expectations," according to Pali Capital home building analyst Stephen East, but it was based largely on declining raw materials prices.

The street was expecting a loss of one cent per share.

Though it beat analyst estimates, the company did not have a good quarter.Net sales from continuing operations declined 23% to $2.0 billion compared with $2.6 billion for the second quarter of 2008. North American sales declined 21%; international sales dropped 30%.

The company said second quarter of 2009 results were adversely affected by significantly lower sales volume of new home construction products and services, as well as a continued decline in consumer spending for home improvement products in both North American and international markets, as well as a less favorable product mix. The negative market conditions were partially offset by increased sales volume of paints and stains, improved relationship between selling prices and commodity costs and the benefits associated with business rationalizations and other cost savings initiatives.

Masco continues to estimate that 2009 housing starts will decline 40% to approximately 550,000 units. The Company also anticipates that consumer spending for home improvement products in all its markets will continue at depressed levels in the near-term.

The company posted a $26 million loss for the first half of 2009, and it issued guidance that it expects the 2009 sales decline to fall between 20% and 25% and that it will lose between $0.05 and $0.25 per share for the full year.

Masco stock soared on the news, up 13.4% at $13.10 in late afternoon trading Tuesday. East wrote in a research note that much of that gain could likely be attributed to "massive short covering" by investors who were swayed by the company's conservative guidance.