On a GAAP basis, the company reported EPS of $5.87, which includes a one-time benefit of $5.42 per share from the reversal of a deferred tax asset valuation allowance.
Revenue from home sales rose 21% year-over-year, driven by an 11% increase in the average selling price to $310,000, and a 9% increase in closings to 4,817 homes. The selling price increase reflects a change in the mix of closings to more move-up and active adult homes, which typically sell for higher prices.
The company’s CEO said:
While consumers have recently slowed home purchases due to higher home prices, a rapid rise in mortgage rates, and political and economic uncertainty, we believe the slowdown will ultimately prove to be short lived within a sustained, multiyear housing recovery.
The company did not offer guidance, but the consensus estimate for the current quarter calls for EPS of $0.42 on revenues of $1.62 billion. For the full year, the consensus estimate calls for EPS of $1.06 on revenues of $5.51 billion.
Whether PulteGroup and the other home builders will see a sustained recovery in home buying remains to be seen. The weak U.S. economy offers some assistance in the form of continued Fed asset purchases, but unless the employment situation improves and wages rise, new home buyers may not return as quickly as builders might like.
The company’s shares were up 1.9% in premarket trading, at $17.00 in a 52-week range of $14.23 to $24.47. Thomson Reuters had a consensus analyst price target of around $20.25 before the report.
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