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Valued at a market cap of $22.1 billion, PulteGroup, Inc. (PHM) is a leading homebuilder in the United States. The Atlanta, Georgia-based company engages in homebuilding and financial services, catering to diverse customer segments such as first-time buyers, move-up buyers, and active adults. The company is expected to announce its fiscal Q4 earnings results before the market opens on Thursday, Jan. 30.
Ahead of this event, analysts expect the homebuilder to report a profit of $3.21 per share, down 2.1% from $3.28 per share in the year-ago quarter. However, the company has surpassed Wall Street's bottom-line estimates in the past four quarters. PHM exceeded the consensus EPS estimate by 8.1% in the most recent quarter.
For fiscal 2024, analysts expect PHM to report an EPS of $12.96, an increase of 10.6% from $11.72 in fiscal 2023.
Over the past 52 weeks, PHM has risen 4.6%, underperforming the S&P 500 Index's ($SPX) 25.8% gain and the Consumer Discretionary Select Sector SPDR Fund's (XLY) 26.4% increase on a YTD basis.
Despite reporting stronger-than-expected Q3 earnings of $3.35 per share and revenue of $4.5 billion, shares of PulteGroup tumbled 7.2% on Oct. 22. This decline was driven by a decrease in home sales gross margin, which fell to 28.8% from 29.5% in the year-ago quarter. Additionally, the average selling price of homes declined to $548,000. While home closings rose 12% year-over-year to 7,924 units, the unit backlog declined to 12,089 units with a value of $7.7 billion. Furthermore, an increase in SG&A expenses, which rose to 9.4% of home sales revenue, added to the downward pressure on the stock.
Analysts' consensus view on PHM stock is cautiously optimistic, with a "Moderate Buy" rating. Out of 16 analysts covering the stock, eight give a "Strong Buy," one has a "Moderate Buy," and seven gives a "Hold" rating. As of writing, PHM is trading below the average analyst price target of $146.82.
