U.S. markets closed

PulteGroup (PHM) Gains But Lags Market: What You Should Know

Zacks Equity Research

In the latest trading session, PulteGroup (PHM) closed at $19.54, marking a +0.41% move from the previous day. The stock lagged the S&P 500's daily gain of 0.47%. Elsewhere, the Dow gained 0.95%, while the tech-heavy Nasdaq added 2.3%.

Heading into today, shares of the homebuilder had lost 58.2% over the past month, lagging the Construction sector's loss of 44.25% and the S&P 500's loss of 28.7% in that time.

Wall Street will be looking for positivity from PHM as it approaches its next earnings report date. In that report, analysts expect PHM to post earnings of $0.70 per share. This would mark year-over-year growth of 18.64%. Meanwhile, our latest consensus estimate is calling for revenue of $2.33 billion, up 16.83% from the prior-year quarter.

PHM's full-year Zacks Consensus Estimates are calling for earnings of $4.09 per share and revenue of $11.28 billion. These results would represent year-over-year changes of +17.19% and +10.42%, respectively.

Investors might also notice recent changes to analyst estimates for PHM. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.07% higher within the past month. PHM is currently sporting a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that PHM has a Forward P/E ratio of 4.76 right now. For comparison, its industry has an average Forward P/E of 3.95, which means PHM is trading at a premium to the group.

Also, we should mention that PHM has a PEG ratio of 0.5. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Building Products - Home Builders stocks are, on average, holding a PEG ratio of 0.47 based on yesterday's closing prices.

The Building Products - Home Builders industry is part of the Construction sector. This group has a Zacks Industry Rank of 23, putting it in the top 10% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
PulteGroup, Inc. (PHM) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.