Why PulteGroup (PHM) Could Beat Earnings Estimates Again

Core Viewpoint - PulteGroup is well-positioned to continue its earnings-beat streak, with a history of surpassing earnings estimates and a positive earnings outlook [1][5]. Earnings Performance - For the most recent quarter, PulteGroup reported earnings of $3.50 per share, exceeding the expected$3.24 per share, resulting in a surprise of 8.02% [2]. - In the previous quarter, the company reported $3.35 per share against an expectation of$3.10 per share, achieving a surprise of 8.06% [2]. Earnings Estimates and Predictions - There has been a favorable change in earnings estimates for PulteGroup, with a positive Earnings ESP of +0.27%, indicating bullish sentiment among analysts regarding its near-term earnings potential [5][8]. - The combination of a positive Earnings ESP and a Zacks Rank of 3 (Hold) suggests a high likelihood of another earnings beat, with historical data showing that such combinations lead to positive surprises nearly 70% of the time [6][8]. Earnings ESP Explanation - The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate, with the Most Accurate Estimate reflecting the latest analyst revisions, which may be more accurate than earlier predictions [7]. - A negative Earnings ESP can reduce predictive power but does not necessarily indicate an earnings miss [9]. Importance of Earnings ESP - Companies often beat consensus EPS estimates, but this is not the sole reason for share price gains; thus, checking a company's Earnings ESP before quarterly releases is crucial for investment decisions [10].