QUOTE AND NEWS
Benzinga  Apr 25  Comment 
Raymond James has downgraded PulteGroup, Inc. (NYSE: PHM) to Market Perform from Outperform on the CEO succession issues, potential gross margin pressures and drop in absorption rates. The Atlanta, Georgia-based homebuilder is embroiled in an...
Benzinga  Apr 25  Comment 
Clusterstock  Apr 22  Comment 
The housing market is in an interesting place right now. After ostensibly triggering the worst financial crisis in history, it has healed to become one of the fastest-growing components of the US economy. But housing supply has not kept up...
MarketWatch  Apr 19  Comment 
PulteGroup is scheduled to report first-quarter results before the market opens on Thursday. Analysts say the recent public squabble between founder Bill Pulte and the company’s board shouldn’t affect improving fundamentals.
MarketWatch  Apr 12  Comment 
PulteGroup Inc. shares ticked higher in the extended session Tuesday after independent board member James Grosfeld resigned from the homebuilder's board. Pulte shares advanced 1% to $18 after hours. In a letter attached to a Securities and...
newratings.com  Apr 12  Comment 
WASHINGTON (dpa-AFX) - PulteGroup, Inc. (PHM) said it was disappointed that William Pulte, shareholder and founder of the company, continue to attempt to destabilize the company's leadership and derail the company's successful...
MarketWatch  Apr 11  Comment 
PulteGroup Inc. founder Bill Pulte sent another letter Monday to the home builder's board, calling for the immediate removal and replacement of Chief Executive Richard Dugas. Pulte said Dugas' current "value creation strategy" has done the...




 

Pulte Homes (PHM) (NYSE:PHM) is a homebuilder. In 2009, the company sold 15,013 homes across 27 states in all regions of the country.[1] Pulte targets first-time and move-up buyers, with most of its properties being single-family detached homes. At an average home selling price of $258,000, the company offers homes that are more expensive than the national median home price of around $210,000.[1]

The company operates in a highly cyclical industry. New home construction, home prices and new home sales volume are heavily dependent upon job growth, interest rates, and the business cycle at large. Low interest rates and high job growth bode well for homebuilding, but as the recent subprime lending crisis and depressed housing market has illustrated, things can sour quickly and the business can be difficult to predict. Key homebuilding numbers, such as housing starts and existing home sales have continued to come in weak of late. Homebuilding is highly competitive and marked by few barriers to entry, low profit margins, and high financial leverage.

Since early 2006, the U.S. housing market has been unfavorably impacted by a lack of consumer confidence, tightened mortgage standards, and large supplies of resale and new home inventories and related pricing pressures. These factors have contributed to weakened demand for new homes, slower sales, and increased price discounts and sales incentives to attract homebuyers. All of these contribute negatively to PHM's revenues and net income. This could not posisbly have been more helpful!

Competition

The company competes against a highly fragmented base of other homebuilders. These companies may be national or local players and given the highly competitive nature of the industry, competition is stiff and often marked by low margins and low returns on capital. The company also competes for buyers with existing homes that have hit the market, and competes more broadly with other housing alternatives such as apartments and mobile homes.

Some of PHM's top competitors include Lennar (LEN), D.R. Horton (DHI), Centex (CTX), KB Home (KBH), HOVNANIAN ENTERPRISES (HOV), Beazer Homes USA (BZH), and Ryland Group (RYL).

Footnotes

  1. 1.0 1.1 PHM 10-K 2009 Item 1 Pg. 4
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