PulteGroup Inc. Earnings Cheat Sheet: Quarterly Loss Narrows

S&P 500 (NYSE:SPY) component PulteGroup Inc.’s (NYSE:PHM) third quarter loss narrowed, beating estimates. PulteGroup is a publicly held holding company involved in the homebuilding and financial services businesses.

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PulteGroup Earnings Cheat Sheet for the Third Quarter

Results: Loss narrowed to $129 million (loss of 34 cents per diluted share) from $995.1 million (loss of $2.63 per share) in the same quarter a year earlier.

Revenue: Rose 8% to $1.11 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: PHM reported adjuted net income of breaking even. By that measure, the company was about in line with the mean estimate. It beat the average revenue estimate of $1.05 billion.

Quoting Management: “I am pleased to report that PulteGroup’s operations, excluding any impact from the goodwill impairment or tax gain in the quarter, returned to profitability for this quarter despite a housing demand environment that remains at historically low levels,” said Richard J. Dugas, Jr., PulteGroup Chairman, President and Chief Executive Officer. “Our results were achieved through a combination of higher closings, improved margins and reduced SG&A expenditures. I am particularly pleased with the progress we continue to make in improving our homebuilding gross margin, along with the tangible results from our efforts to reduce the Company’s cost structure and to more effectively allocate capital to projects that generate improved financial returns. PulteGroup’s Q3 results demonstrate further success in our efforts to better position our homebuilding operations for long-term profitability.”

Key Stats:

A year-over-year revenue increase last quarter snaps a streak of four consecutive quarters of revenue declines. The worst quarter in that span was the fourth quarter of the last fiscal year, which saw a 31.5% decrease.

The company beat estimates last quarter after being in line with expectations in the second quarter with a loss of 4 cents per share.

Looking Forward: For the next quarter, analysts are growing pessimistic about the company’s expected results. The average estimate for the fourth quarter is 4 cents per share, dropping from 5 cents a month ago. Down from a loss of 13 cents per share ninety days ago, the average estimate for the fiscal year is now a loss of 20 cents.

Competitors to Watch: D.R. Horton, Inc. (NYSE:DHI), Lennar Corporation (NYSE:LEN), The Ryland Group, Inc. (NYSE:RYL), Toll Brothers, Inc. (NYSE:TOL), KB Home (NYSE:KBH), M.D.C. Holdings, Inc. (NYSE:MDC), Orleans Homebuilders (OHBIQ), Hovnanian Enterprises, Inc. (NYSE:HOV), Standard Pacific Corp. (NYSE:SPF), and Comstock Homebuilding Companies, Inc. (NASDAQ:CHCI).

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(Source: Xignite Financials)