PulteGroup Inc. (PHM) reported stellar results in first-quarter 2024, wherein earnings and revenues surpassed the Zacks Consensus Estimates.Also, both metrics increased year over year on favorable demand conditions and its balanced operating model, which allows the company to more effectively meet the individual needs of first-time, move-up and active-adult consumers.PHM’s president and CEO, Ryan Marshall, said, “Given PulteGroup’s broad operating platform and deep product portfolio, along with the powerful ...

Financial Data and Key Metrics - Q1 2024 revenue reached $3.8 billion, with gross margins of 29.6% and earnings per share of $3.10 [7] - Home sale revenues increased by 10% YoY to $3.8 billion, driven by an 11% increase in closings to 7,095 homes, partially offset by a 1% decrease in average sales price to $538,000 [16] - Net new orders increased 14% YoY to 8,379 homes, with cancellation rates dropping to 10.1% from 12.7% in Q1 2023 [18] - Gross margin improved by 50 basis points YoY to 29.6%, exceeding guidance [21] - Pre-tax income reached a record $869 million, up 24% YoY, with net income of $663 million or $3.10 per share [27] Business Line Performance - Closings mix: 41% first-time buyers, 36% move-up, and 23% active adult, compared to 38%, 36%, and 26% respectively in Q1 2023 [17] - Net new orders increased across all buyer groups: first-time buyers +8%, move-up +22%, and active adult +12% [19] - Financial services pre-tax income surged nearly 200% YoY to $41 million, driven by improved market conditions and higher capture rates [26] Market Performance - Strong demand continued in the Southeast, Florida, and Texas, while previously struggling markets like Arizona, California, and Nevada showed significant improvement [10] - Net pricing increased by 1% to 5% across more than half of the communities due to stable or improving pricing dynamics [11] - Average community count increased by 6% YoY to 931, with an absorption pace of approximately three homes per month [18] Strategy and Industry Competition - The company maintained pricing discipline in Q4 2023, which allowed for higher margins and inventory availability for the 2024 spring selling season [9] - The housing market remains supply-constrained, with a structural shortage of approximately 4 million housing units in the US [12] - Mortgage rate buy-downs were used by 25% of home buyers in Q1, providing a competitive advantage in a high-interest-rate environment [13] Management Commentary on Operating Environment and Outlook - Management highlighted the resilience of the economy and strong job market, expressing optimism for 2024 despite higher interest rates [14] - The company raised its full-year guidance for closings to approximately 31,000 homes, representing an 8% increase over 2023 [20] - Gross margin guidance for Q2 2024 was raised to 29.2%, with expectations of 29% for Q3 and Q4 [23] Other Important Information - The company invested $1.1 billion in land acquisition and development in Q1, with plans to invest approximately $5 billion for the full year [28] - Share repurchases totaled 2.3 million shares at an average price of $106.73 per share, costing $246 million [30] - The company ended Q1 with $1.8 billion in cash and a net debt-to-capital ratio of 1.7% [31] Q&A Session Summary Question: Long-term land strategy and cash flow expectations [37][39] - The company aims to control seven years of land supply, with 70% under option, a multi-year journey to achieve ideal economics [38] - Cash flow from operations is expected to increase, with capital allocated to business growth, dividends, and stock repurchases [41][42] Question: Incentive strategy and margin trade-offs [45][48] - The company will not prioritize margin over growth, using mortgage rate buy-downs to support affordability, with incentives expected to remain flat at 6.5% [46][47] - Land costs are expected to increase mid to high single digits, with no significant deceleration in the land market [49][50] Question: Construction cycle times and existing home inventory [52][55] - Construction cycle times improved to 128 days, with a target of 100 days by year-end [53] - Existing home inventory is largely neutral on supply, as most sellers are likely to buy another home [56] Question: Impact of NAR settlement and regional market trends [58][60] - The NAR settlement may increase transparency in real estate fees, with over 60% of sales involving buyer-side realtors [59] - Western markets like Arizona, California, and Nevada improved due to price adjustments and better buyer sentiment [61] Question: Demand trends and material costs [63][66] - Demand remained strong in Q1, with some moderation in April due to rising interest rates [64] - Material costs were stable at $80 per square foot, with low single-digit inflation expected for 2024 [67] Question: Gross margin outlook and mix impact [68][71] - Gross margins are expected to remain flat YoY, driven by pricing increases and favorable mix shifts [69] - The step-down in Q2 gross margin guidance reflects a reversal of the Q1 mix benefit and expected changes in geographic mix [72] Question: Spec vs. build-to-order strategy and incentive sensitivity [94][97] - The company maintains a 50/50 split between spec and build-to-order, with flexibility to adjust based on market conditions [95] - Incentives are expected to remain flat, but the company will monitor demand and adjust pricing or incentives as needed [97][100] Question: Florida market performance [102][104] - Florida remains a strong market, with a focus on move-up and age-targeted buyers, though affordability challenges persist due to price appreciation and rising property taxes and insurance costs [103][104]

For the quarter ended March 2024, PulteGroup (PHM) reported revenue of $3.95 billion, up 10.5% over the same period last year. EPS came in at $2.87, compared to $2.35 in the year-ago quarter.The reported revenue represents a surprise of +10.09% over the Zacks Consensus Estimate of $3.59 billion. With the consensus EPS estimate being $2.36, the EPS surprise was +21.61%.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their ...

FOR IMMEDIATE RELEASE Company Contact Investors: Jim Zeumer (404) 978-6434 Email: jim.zeumer@pultegroup.com PULTEGROUP, INC. REPORTS FIRST QUARTER 2024 FINANCIAL RESULTS ATLANTA - April 23, 2024 – PulteGroup, Inc. (NYSE: PHM) announced today financial results for its first quarter ended March 31, 2024. For the quarter, the Company reported net income of $663 million, or $3.10 per share. Reported net income for the quarter includes a $38 million pre-tax, or $0.14 per share, gain related to the sale of a join ...

PulteGroup, Inc.’s (PHM) Homebuilding segment, which accounted for more than 98% of total revenues, is expected to showcase tepid growth year over year when PHM reports first-quarter 2024 results on Apr 23.Despite challenges, PulteGroup showcased a robust performance over the past six months, witnessing a stock surge of 49.4%. This growth has outpaced the Zacks Building Products - Home Builders industry's increase of 42.2%. The company's strategic focus on entry-level buyers, liquidity management, and prude ...

PulteGroup Inc. (PHM) is scheduled to report first-quarter 2024 results on Apr 23, before the opening bell.In the last reported quarter, the company’s earnings per share (EPS) beat the Zacks Consensus Estimate by 2.5% but revenues missed the same by 4.2%. However, adjusted EPS and revenues decreased 14.8% and 15.5% on a year-over-year basis, respectively.PulteGroup’s earnings topped the consensus mark in all the trailing four quarters, the average surprise being 15.1%.Trend in Estimate RevisionThe Zacks Con ...

In its upcoming report, PulteGroup (PHM) is predicted by Wall Street analysts to post quarterly earnings of $2.36 per share, reflecting an increase of 0.4% compared to the same period last year. Revenues are forecasted to be $3.59 billion, representing a year-over-year increase of 0.3%.The consensus EPS estimate for the quarter has undergone an upward revision of 1.1% in the past 30 days, bringing it to its present level. This represents how the covering analysts, as a whole, have reassessed their initial e ...

The current market backdrop is faring well for homebuilders like PulteGroup, Inc. (PHM) , attributable to stable interest rates, limited inventory of existing homes and improving economic conditions. These tailwinds are sparking consumer confidence, which is leading to increased demand for new homes. To satiate the growing demand for new homes, PulteGroup is undertaking several initiatives to equip itself with a readily available supply of homes and lots.In consideration of these initiatives, one of PulteGr ...

Company Performance - PulteGroup's stock closed at $108.79, reflecting a -1.89% change from the previous trading day, underperforming the S&P 500's 1.2% loss [1] - Over the past month, PulteGroup's shares have decreased by 0.01%, outperforming the Construction sector's loss of 1.46% and the S&P 500's loss of 0.85% [1] - The upcoming earnings report is scheduled for April 23, 2024, with projected EPS of $2.36, indicating a 0.43% increase year-over-year, and expected revenue of $3.59 billion, up 0.32% from the prior year [1] Analyst Estimates - For the fiscal year, Zacks Consensus Estimates project earnings of $11.79 per share and revenue of $16.9 billion, representing changes of +0.6% and +5.22% from the prior year [2] - Recent changes to analyst estimates indicate a positive outlook for PulteGroup's business operations and profit generation [2] - The Zacks Rank system, which rates stocks from 1 (Strong Buy) to 5 (Strong Sell), currently ranks PulteGroup at 2 (Buy) [3] Valuation Metrics - PulteGroup has a Forward P/E ratio of 9.41, which is in line with the industry average [3] - The company has a PEG ratio of 0.54, compared to the industry average PEG ratio of 0.84 [3] Industry Overview - The Building Products - Home Builders industry is part of the Construction sector and holds a Zacks Industry Rank of 53, placing it in the top 22% of over 250 industries [4] - The Zacks Industry Rank measures the strength of industry groups, with the top 50% rated industries outperforming the bottom half by a factor of 2 to 1 [4]

Group 1: Analyst Recommendations - PulteGroup (PHM) has an average brokerage recommendation (ABR) of 1.69, indicating a position between Strong Buy and Buy, based on recommendations from 16 brokerage firms [1] - Out of the 16 recommendations, 10 are Strong Buy and 1 is Buy, accounting for 62.5% and 6.3% of all recommendations respectively [1] Group 2: Limitations of Brokerage Recommendations - Solely relying on brokerage recommendations may not be advisable, as studies show they often fail to guide investors effectively towards stocks with high price appreciation potential [2] - Brokerage analysts tend to exhibit a strong positive bias due to vested interests, with five "Strong Buy" recommendations for every "Strong Sell" [2] Group 3: Zacks Rank as an Alternative - Zacks Rank categorizes stocks into five groups, from Strong Buy to Strong Sell, and is based on earnings estimate revisions, which correlate strongly with near-term stock price movements [3][4] - The Zacks Rank is updated more frequently than the ABR, reflecting timely changes in earnings estimates and business trends [5] Group 4: Current Earnings Estimates for PulteGroup - The Zacks Consensus Estimate for PulteGroup's current year earnings has increased by 0.1% over the past month to $11.78, indicating growing optimism among analysts [6] - This increase in consensus estimates has led to a Zacks Rank 2 (Buy) for PulteGroup, suggesting potential for stock price appreciation [6]