Why Homebuilder PulteGroup Shares Are Higher Today
Portfolio Pulse from Lekha Gupta
PulteGroup, Inc. (NYSE:PHM) shares rose after reporting first-quarter FY24 results with revenue of $3.95 billion, surpassing the consensus of $3.58 billion. Home sale revenues increased by 10% Y/Y to $3.8 billion, driven by an 11% increase in closings. The gross margin for home sales improved to 29.6%, and net new orders grew by 14% Y/Y. GAAP EPS was up 32% Y/Y to $3.10, and adjusted EPS of $2.87 beat the consensus of $2.36. The company also repurchased 2.3 million shares and ended the quarter with a strong cash position and backlog. Investors can also gain exposure to PulteGroup through IShares U.S. Home Construction ETF (BATS:ITB) and Invesco Building & Construction ETF (NYSE:PKB).
April 23, 2024 | 2:38 pm
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POSITIVE IMPACT
Investors can gain exposure to PulteGroup's positive performance through the IShares U.S. Home Construction ETF (ITB), which includes PHM as part of its holdings.
As ITB includes PulteGroup in its holdings, the strong performance of PHM, especially in the home construction sector, is likely to positively influence ITB's performance in the short term.
CONFIDENCE 85
IMPORTANCE 75
RELEVANCE 70
POSITIVE IMPACT
PulteGroup reported strong first-quarter FY24 results, with revenue and EPS exceeding expectations, leading to a 3.9% increase in its stock price.
The positive earnings report, with significant year-over-year growth in revenue, EPS, and home sales, directly impacts investor sentiment and stock price. The share repurchase program also signals confidence in the company's financial health, further supporting the stock's short-term performance.
CONFIDENCE 95
IMPORTANCE 90
RELEVANCE 100
POSITIVE IMPACT
PulteGroup's positive earnings report and stock performance offer potential benefits to the Invesco Building & Construction ETF (PKB), which holds PHM.
Given PKB's inclusion of PulteGroup in its portfolio, the strong quarterly performance of PHM is expected to have a positive impact on PKB's short-term performance, mirroring the positive trends in the home construction sector.
CONFIDENCE 85
IMPORTANCE 75
RELEVANCE 70