Valued at a market cap of $21.5 billion, PulteGroup, Inc. (PHM) is a homebuilder based in Atlanta, Georgia. It designs and constructs a diverse range of residential properties, including single-family detached homes, townhomes, condominiums, and duplexes.
This homebuilder has underperformed the broader market over the past 52 weeks. Shares of PHM have gained 11.6% over this time frame, while the broader S&P 500 Index ($SPX) has soared 26.6%. Moreover, on a YTD basis, the stock is down 2.9%, compared to SPX’s 8.1% rise.
Looking closer, PHM has outperformed the State Street SPDR S&P Homebuilders ETF (XHB), which gained 1.4% over the past 52 weeks. Meanwhile, it has fairly aligned with XHB’s 2.8% drop.
On Apr. 23, shares of PHM soared 2.4% after delivering mixed Q1 results. The company’s revenue fell 12.4% year-over-year to $3.4 billion, but topped analyst estimates by a slight margin, bolstering investor confidence. However, its EPS of $1.79 missed consensus expectations of $1.80. Management noted that higher incentives aimed at improving affordability for buyers, particularly first-time homebuyers, weighed on performance.
For the current fiscal year, ending in December, analysts expect PHM’s EPS to decline 12.6% year over year to $10. The company’s earnings surprise history is mixed. It topped the consensus estimates in three of the last four quarters, while missing on another occasion.
Among the 17 analysts covering the stock, the consensus rating is a "Moderate Buy,” which is based on eight “Strong Buy,” one "Moderate Buy,” seven “Hold,” and one "Strong Sell” rating.
The configuration is less bullish than a month ago, with nine analysts suggesting a “Strong Buy” rating.
On Apr. 28, JPMorgan Chase & Co. (JPM) analyst Michael Rehaut maintained a “Buy” rating on PHM and set a price target of $130, indicating a 14.2% potential upside from the current levels.
The mean price target of $137.50 suggests a 20.8% premium to its current price levels, while its Street-high price target of $162 implies a 42.3% potential upside.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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