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PulteGroup (PHM) Outpaces Stock Market Gains: What You Should Know

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In the latest trading session, PulteGroup (PHM - Free Report) closed at $43.17, marking a +1.89% move from the previous day. This move outpaced the S&P 500's daily gain of 0.81%. Elsewhere, the Dow gained 0.3%, while the tech-heavy Nasdaq added 0.37%.

Prior to today's trading, shares of the homebuilder had lost 14.18% over the past month. This has lagged the Construction sector's loss of 0.59% and the S&P 500's gain of 5.64% in that time.

Wall Street will be looking for positivity from PulteGroup as it approaches its next earnings report date. This is expected to be April 28, 2022. In that report, analysts expect PulteGroup to post earnings of $1.71 per share. This would mark year-over-year growth of 33.59%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.06 billion, up 11.94% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $10.12 per share and revenue of $16.54 billion, which would represent changes of +38.63% and +18.74%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for PulteGroup. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. PulteGroup currently has a Zacks Rank of #2 (Buy).

Digging into valuation, PulteGroup currently has a Forward P/E ratio of 4.19. Its industry sports an average Forward P/E of 4.12, so we one might conclude that PulteGroup is trading at a premium comparatively.

It is also worth noting that PHM currently has a PEG ratio of 0.45. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Building Products - Home Builders was holding an average PEG ratio of 0.38 at yesterday's closing price.

The Building Products - Home Builders industry is part of the Construction sector. This group has a Zacks Industry Rank of 60, putting it in the top 24% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.


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