) is set to report its fourth-quarter fiscal 2013 results on Jan
30 before the market opens. Last quarter, Pulte posted a positive
surprise of 32.35%. Let's see how things are shaping up for this
Factors to Consider This Quarter
Strong margins and pricing at Pulte have been driving the
homebuilder's earnings. However, the company has been witnessing
weak order growth due to lower community count and higher
interest rates. The company has intentionally slowed down sales
pace across some of its communities due to lack of land
development and scarcity of finished lots. Instead the company is
focusing more on driving price and margins in most communities.
As such this trend is expected to continue in the upcoming
quarter. Other homebuilders like
D.R Horton, Inc.
) and Hovnanian Enterprises, Inc. also experienced weak orders in
the past few quarters.
Our proven model does not conclusively show that PulteGroup is
likely to beat earnings this quarter. That is because a stock
needs to have both a positive
and a Zacks Rank of #1, 2 or 3 for this to happen. That is not
the case here, as you will see below.
The Earnings ESP is 0.00%.
PulteGroup carries a Zacks Rank #3 (Hold) which when combined
with a 0.00% ESP makes surprise prediction difficult. We caution
against stocks with Zacks Ranks #4 and 5 (Sell-rated stocks)
going into the earnings announcement, especially when the company
is seeing negative estimate revisions momentum.
Other Stocks to Consider
Here are some other companies from the construction sector which
you may consider, as our model shows they have the right
combination of elements to post an earnings beat this quarter:
Meritage Homes Corp.
), with an Earnings ESP of +1.96% and a Zacks Rank #3 (Hold).
Primoris Services Corp.
), with an Earnings ESP of +10.26% and a Zacks Rank #3 (Hold).
D R HORTON INC (DHI): Free Stock Analysis
MERITAGE HOMES (MTH): Free Stock Analysis
PULTE GROUP ONC (PHM): Free Stock Analysis
PRIMORIS SERVCS (PRIM): Free Stock Analysis
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