Pulte Group Tops Estimates - Analyst Blog
February 02 2012 - 7:20AM
Zacks
Pulte Group, Inc. (PHM) reported a profit of
$14 million or 4 cents per share in the fourth quarter of 2011
compared with a loss of $165 million or 44 cents per share in the
same quarter of 2010. Before special items, the company’s profit
stood at $41 million or 11 cents per share during the quarter,
exceeding the Zacks Consensus Estimate of 8 cents per share and the
year ago profit of $6 million or 1 cent per share.
Pulte’s revenues rose marginally by 1% to $1.2 billion from the
fourth quarter of 2010. The increase in revenues was attributable
to a 3% increase in average selling prices to $271,000, which was
partially offset by a 2% decrease in closings to 4,303
homes.
Cost of sales related to home sales was $1.0 billion during the
quarter (including $11 million of impairments) compared with $1.1
billion in the prior-year quarter (including $82 million of
impairments).
Excluding impairments, interest expense and merger-related
costs, home sale gross margin was 18.6% in the quarter, reflecting
an improvement of 200 basis points over the fourth quarter of
2010.
Selling, general & administrative expenses were $117
million, or 10% of home sale revenues, compared with $151 million,
or 13% of home sale revenues, in the fourth quarter of
2010.
Pulte had net new orders of 3,084 homes during the quarter
compared with 3,044 homes a year ago. The company’s contract
backlog was 3,924 homes with a constructed value of $1.1 billion as
of December 31, 2011 compared with a contract backlog of 3,984
homes, valued at $1.1 billion, as of December 31, 2010.
Revenues in the company’s Financial Services scaled up 6.5% to
$1.3 billion. The segment had a pretax loss of $27.4 million in the
quarter compared with a profit of $5.3 million in the fourth
quarter of 2010.
Annual Results
For full year 2011, PulteGroup reported a narrower loss of $210
million or 55 cents per share compared with a loss of $1.1 billion
or $2.90 per share in 2010. Excluding special items, the company
had a loss of $2 million or zero cents per share compared with the
Zacks Consensus Estimate of a loss of 52 cents per share and the
year-ago level of $307 million or 80 cents per share.
Revenues from home sales dipped 9% to $4.0 billion from $4.4
billion in the prior year, driven primarily by an 11% fall in
closings to 15,275 homes. The decrease in unit closings
reflects the pulling ahead of demand created by the tax credit in
2010 and the company’s lower community count. Meanwhile, revenues
from Financial Services declined 9.5% to $4.1 billion during the
year.
Financial Position
Pulte had cash and cash equivalents of $1.1 billion as of
December 31, 2011 compared with $1.5 billion as of December 31,
2010. The company had senior notes of $3.1 billion as of December
31, 2011 versus $3.4 billion as of December 31, 2010.
Pulte’s cash flow from operations declined to $17.2 million in
2011 from $590.9 million in the previous year. Meanwhile, capital
expenditures increased to $21.2 million from $15.2 million in
2010.
Outlook
Based in Bloomfield Hills, Michigan, PulteGroup engages in the
homebuilding and financial services businesses primarily in the
U.S. and Puerto Rico. It competes with Lennar
Corp. (LEN), KB Home (KBH) and DR
Horton Inc. (DHI).
The company expects challenging macroeconomic conditions will
persist in 2012. Nevertheless, it expects to be profitable for the
year. Currently, it retains a Zacks #3 Rank on its shares, which
translates to a short-term (1 to 3 months) rating of Hold”.
D R HORTON INC (DHI): Free Stock Analysis Report
KB HOME (KBH): Free Stock Analysis Report
LENNAR CORP -A (LEN): Free Stock Analysis Report
PULTE GROUP ONC (PHM): Free Stock Analysis Report
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