PulteGroup Inc. PHM is scheduled to report its second-quarter 2026 results on July 22, before the opening bell.
In the last reported quarter, the company’s adjusted earnings per share (EPS) missed the Zacks Consensus Estimate by 0.6%, and revenues surpassed the same by 0.7%. On a year-over-year basis, adjusted EPS declined 30.4%, and revenues decreased 12.4% year over year.
PulteGroup’s earnings topped the consensus mark in three of the trailing four quarters and missed on one occasion, with an average surprise of 2.6%.
Trend in PHM Stock’s Estimate Revision
The Zacks Consensus Estimate for PHM’s second-quarter EPS has increased to $2.38 from $2.36 over the past 30 days. The estimated figure indicates a 21.5% decrease from the year-ago EPS of $3.03.
The consensus mark for total revenues is pegged at $3.98 billion, implying a 9.6% year-over-year decline.
PulteGroup, Inc. Price and EPS Surprise
PulteGroup, Inc. price-eps-surprise | PulteGroup, Inc. Quote
Factors Likely to Have Shaped PulteGroup’s Q2 Earnings
Topline: PulteGroup’s second-quarter revenues are likely to have been supported by higher expected closing volumes. Management guided for 6,700-7,100 home closings during the quarter, reflecting a sequential increase from the first quarter as homes already under construction progressed toward delivery. Continued growth in community count, projected at 3-5% year over year, and the company's sizable land pipeline are likely to have supported sales activity.
For the second quarter, our model predicts home closings to decline 8.6% year over year to 6,982 units. Segment-wise, for the second quarter, our model predicts overall Homebuilding revenues (which contributed 97.9% to total revenues in the first quarter of 2026) to decrease 10.2% year over year to $3.87 billion. Our model expects Financial Services revenues (which contributed 2.1% to total revenues in the first quarter) to grow 0.4% year over year to $101.5 million.
Demand trends were expected to remain relatively resilient despite elevated mortgage rates. The company continued to benefit from healthy demand among move-up and active-adult buyers, particularly in Florida, the Northeast and parts of the Southeast, while its strategic shift toward a higher build-to-order mix likely enhanced order quality and future revenue visibility. Management also noted that buyer traffic remained healthy and seasonal demand trends held up well despite macroeconomic and geopolitical uncertainty.
However, affordability constraints likely continued to weigh on first-time buyers, limiting broader demand. Elevated incentives remained necessary to stimulate sales in a competitive housing market, while average selling prices (ASPs) were guided to a range of $540,000-$550,000, suggesting continued pricing pressure. Regional weakness in parts of Texas and the West, together with cautious consumer sentiment tied to mortgage rates, may also have constrained top-line growth. Our model predicts the ASP of homes closed to decrease 2.1% year over year to $547,200.
Margins: Margins are expected to have remained under pressure during the quarter. Management projected home sale gross margin of 24.1-24.4%, indicating that the second quarter is likely to represent the low point of the year. Elevated incentives, competitive pricing and the closing of previously sold spec homes carrying heavier discounts are expected to have weighed on profitability.
Our model predicts homebuilding gross margin to be 24.2% for the quarter, down from the year-ago period level of 27%. We predict SG&A expenses (as a percentage of home sales revenues) to be 9.2%, up 10 basis points year over year.
Nevertheless, lower construction costs, supported by reduced lumber prices and procurement savings across several building materials, likely provided some relief. Continued efforts to reduce finished spec inventory and disciplined production management are likely to have supported operational efficiency. Share repurchases, which reduced the average diluted share count, were expected to have provided a modest boost to EPS even as lower financial services profitability and softer pricing weighed on the bottom line.
Orders & Backlogs: Our model expects PulteGroup’s net new orders to be up 1.4% year over year to 7,180 units in the second quarter. We expect the total backlog to decline 1.4% to 10,625 units, with the total backlog value dropping 2.4% year over year to $6.68 billion.
What Our Model Unveils for PHM
Our proven model does not conclusively predict an earnings beat for PulteGroup this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.
PHM’s Earnings ESP: The company has an Earnings ESP of 0.00%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Zacks Rank of PHM: The stock currently carries a Zacks Rank #3.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks to Consider
Here are other companies in the Zacks Construction sector, which, according to our model, have the right combination of elements to post an earnings beat.
Boise Cascade Company BCC has an Earnings ESP of +6.50% and a Zacks Rank of 1 at present.
Boise Cascade’s earnings beat estimates in two of the last four quarters, missed on one occasion and met on the remaining occasion, the average surprise being 40.8%. The company’s earnings for the second quarter of 2026 are expected to decline 25% year over year.
Dycom Industries, Inc. DY currently has an Earnings ESP of +0.47% and a Zacks Rank of 1.
Dycom’s earnings beat estimates in all the last four quarters, the average surprise being 25%. The company’s earnings for the second quarter of fiscal 2027 are expected to increase 39.3% year over year.
CRH plc CRH has an Earnings ESP of +4.08% and a Zacks Rank of 3.
CRH’s earnings beat estimates in two of the last four quarters, missed on one occasion and met on the remaining occasion, the average surprise being 0.7%. The company’s earnings for the second quarter of 2026 are expected to inch up 1% year over year.
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PulteGroup, Inc. (PHM): Free Stock Analysis Report
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Boise Cascade, L.L.C. (BCC): Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).