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PulteGroup’s investors are proving hard to please.
The US homebuilder posted a solid 14 per cent jump in first quarter revenue as relatively low interest rates and the steady recovery in the US economy continued to fuel demand for new homes.
However the sales growth fell short of the market’s very high expectations, prompting shares to drop 2.5 per cent in pre-market trading.
Revenue for the three months to end of March came in at $1.62bn, up from the $1.43bn recorded in the prior year period on a combination of higher closings and price increase. However the revenue figure was lower than $1.76bn the market was expecting.
Net income was up nearly 10 per cent at $91m, or 28 cents per diluted share during the quarter – below the 29 cents a share analysts had predicted.
For the quarter, net new orders increased 8 per cent to 6,126 homes, while the dollar
value of net new orders increased 16 per cent over the prior year to $2.4bn.
“Buyer interest during the spring selling season of 2017 has been high and points to the ongoing strength in recovery for the housing industry,” said chief executive Ryan Marshall. “Strong buyer demand continues to be supported by an improving economy and resulting employment and wage gains, high consumer confidence, a low inventory of new and existing homes, and the powerful demographic forces of Millennials and Baby Boomers.”