Yahoo Finance PulteGroup, Inc. Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next
PulteGroup, Inc. (NYSE:PHM) investors will be delighted, with the company turning in some strong numbers with its latest results. It was a solid earnings report, with revenues and statutory earnings per share (EPS) both coming in strong. Revenues were 10% higher than the analysts had forecast, at US$3.9b, while EPS were US$3.10 beating analyst models by 31%. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Check out our latest analysis for PulteGroup
After the latest results, the 13 analysts covering PulteGroup are now predicting revenues of US$17.2b in 2024. If met, this would reflect a satisfactory 4.8% improvement in revenue compared to the last 12 months. Statutory per share are forecast to be US$12.96, approximately in line with the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$16.9b and earnings per share (EPS) of US$11.87 in 2024. So the consensus seems to have become somewhat more optimistic on PulteGroup's earnings potential following these results.
The consensus price target was unchanged at US$132, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values PulteGroup at US$183 per share, while the most bearish prices it at US$105. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that PulteGroup's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 6.4% growth on an annualised basis. This is compared to a historical growth rate of 12% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 5.1% per year. So it's pretty clear that, while PulteGroup's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards PulteGroup following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at US$132, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on PulteGroup. Long-term earnings power is much more important than next year's profits. We have forecasts for PulteGroup going out to 2026, and you can see them free on our platform here.
Plus, you should also learn about the 1 warning sign we've spotted with PulteGroup .
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
