PulteGroup Sets New 2025 Closing Target of 29,000 Homes Amid Volatile Demand and Rising Incentives

PulteGroup has refined its 2025 closing target to 29,000 homes amid volatile demand and rising incentives. The company reported strong Q2 2025 earnings, with positive financial performance, high closings, gross margins, and overhead leverage. CEO Ryan Marshall highlighted a return on equity of 23% for the trailing 12 months ended June 30.

PulteGroup Inc. (PHM) has refined its 2025 closing target to 29,000 homes, reflecting the company's response to volatile demand and rising incentives. The housing market's unpredictability has led to a more cautious outlook, but PulteGroup remains optimistic about its strategic positions and strong financial performance.

The company reported robust earnings for the second quarter of 2025, with earnings per share (EPS) of $3.03, surpassing the forecast of $2.95. Revenue came in at $4.4 billion, slightly above expectations. This positive performance was evident in the stock's premarket rise of 4.92%, reaching $114. Despite the broader market trends, PulteGroup's stock has shown resilience, trading at a P/E ratio of 7.62, suggesting potential undervaluation relative to peers.

PulteGroup's CEO, Ryan Marshall, emphasized the company's strategic land positions and quality focus during the earnings call. He noted the company's strong procurement capabilities and highlighted the importance of experienced leadership in Florida, where net new orders increased by 2% year-over-year. The company's ability to serve both immediate spec homes and personalized builds from scratch continues to be a competitive advantage, contributing to its high gross margins.

Looking ahead, PulteGroup expects to close 29,000 homes in 2025, with an anticipated average sales price of $1,130,000 per quarter. The company aims for gross margins of 26-26.5% in the third and fourth quarters and projects approximately $1.4 billion in cash flow for the year.

Challenges such as volatile demand, supply chain constraints, and rising material costs could impact future sales. However, PulteGroup's diversified geographic presence and strong financial health position it well to navigate these challenges. The company's return on equity of 23% over the trailing 12 months reflects its robust financial performance and strategic positioning in the housing market.

References:
[1] https://za.investing.com/news/transcripts/earnings-call-transcript-pultegroup-q2-2025-beats-eps-forecast-stock-rises-93CH-3798867