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

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In the latest trading session, PulteGroup (PHM - Free Report) closed at $30.54, marking a +0.16% move from the previous day. The stock lagged the S&P 500's daily gain of 9.28%. At the same time, the Dow added 9.36%, and the tech-heavy Nasdaq gained 9.34%.

Coming into today, shares of the homebuilder had lost 34.7% in the past month. In that same time, the Construction sector lost 31.22%, while the S&P 500 lost 26.56%.

Investors will be hoping for strength from PHM as it approaches its next earnings release. In that report, analysts expect PHM to post earnings of $0.70 per share. This would mark year-over-year growth of 18.64%. Our most recent consensus estimate is calling for quarterly revenue of $2.33 billion, up 16.83% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.13 per share and revenue of $11.28 billion. These totals would mark changes of +18.34% and +10.42%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for PHM. These revisions typically reflect the latest short-term business trends, which can change frequently. 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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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. Within the past 30 days, our consensus EPS projection has moved 0.94% higher. PHM is currently a Zacks Rank #1 (Strong Buy).

Looking at its valuation, PHM is holding a Forward P/E ratio of 7.39. Its industry sports an average Forward P/E of 6.88, so we one might conclude that PHM is trading at a premium comparatively.

We can also see that PHM currently has a PEG ratio of 0.71. 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 industry currently had an average PEG ratio of 0.66 as of yesterday's close.

The Building Products - Home Builders industry is part of the Construction sector. This industry currently has a Zacks Industry Rank of 20, which puts it in the top 8% 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.

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