PulteGroup Inc $ 41.55 -1.11 (-2.6%)
PHM News and Headlines - PulteGroup Inc
If you select stocks that more than double the earnings yield that 20-year high-quality corporate bonds are granting to their holders, you could increase your chances to unearth value opportunities, in my opinion. These bonds, which entail a very low risk of bankruptcy as they represent corporate loans issued by investment-grade companies, are currently yielding a 2.84% monthly return to their holders.
Thus, investors may be interested in the following stocks, as they offer earnings yields of more than 5.7% and have price-earnings ratios below 17.6.
American Equity Investment Life Holding Co
Shares of American Equity Investment Life Holding
Royce Investment Partners recently released its portfolio update for the first quarter of 2020, in which it established 87 new positions for a turnover rate of 8%. The firm’s fiscal quarter ended on March 31.
Renamed from Royce & Associates at the end of 2019, Royce Investment Partners is the investment firm founded by Chuck Royce (Trades, Portfolio) in 1972. The firm specializes in small-cap companies, which it chooses through a bottom-up, risk-conscious approach. The portfolio managers focus on quality and deep value through a variety of open-end and closed-end funds.
Based on the above-listed criteria, the
According to statistics from John Burns Real Estate Consulting (JBRC), a firm that tracks data points from hundreds of builders in the U.S., the number of new homes sold per week declined approximately 85% between the first week of March and the first week of April.
However, numbers unexpectedly began to pick back up again, reaching 35% of early-March levels for the week ended April 19.
“Just this week we have experienced an increase in sales, as well as continued website engagement activity,” Stephan Paul, who serves as the executive vice president of Mid-Atlantic Builders, said.
Who are the buyers?
In light of strong growth in February pending home sales, five homebuilders with expanding operating margins, as well as strong Piotroski F and Altman Z-scores are Cavco Industries Inc. (CVCO), KB Home (KBH), M/I Homes Inc. (MHO), NVR Inc. (NVR) and PulteGroup Inc. (PHM) according to the All-in-One Screener, a GuruFocus Premium feature.
Homebuilding sector reports strong growth in February
The National Association of Realtors reported on Monday that pending home sales increased for the second consecutive month during February, with expansion in month-over-month contract activity for each of the four major regions: Northeast, Midwest, South and West.
As the market attempts to recover from the beating it has taken over the past several weeks from the Covid-19 outbreak and oil price war, value investors are hunting for opportunities to profit from. One such area could be residential construction, as the monthly measure of homebuilder sentiment emulated the escalating economic effects of the coronavirus.
While sentiment levels have remained in a tight range in the low to mid-70s for the past six months, the National Association of Home Builders/ Wells Fargo Housing Market Index reported on Tuesday that it fell to two points to 72 in March. A
Union Pacific Corporation (UNP), Mondelez International Inc (MDLZ) and PulteGroup Inc (PHM) announced quarterly dividends on Thursday, Feb. 6. These large-cap stocks are loyal payers as they have been distributing dividends for more than a decade.
Union Pacific Corporation
In line with the previous distribution, Union Pacific Corporation announced a 97 cents per share quarterly cash dividend that the Omaha, Nebraska-based railroad transportation services provider will pay on March 31, 2020. The ex-dividend date is scheduled for Feb. 27.
Based on Thursday’s closing share price of $186.11, the quarterly distribution produces a forward dividend yield of 2.08% versus the
U.S. stocks were in the green on Tuesday, recovering from the worst day since October 2019. The Dow Jones Industrial Average gained 0.85% to 28,774, the S&P 500 Index rose 1.20% to 3,282 and the Nasdaq Composite Index jumped 1.53% to 9,279.
Non-index stocks have also posted gains and losses recently. Shares of Lear Corp. (LEA) fell more than 4% on Tuesday after the company announced fourth-quarter results. The automotive parts manufacturer posted earnings of
According to the All-in-One Screener, a major GuruFocus Premium feature, four homebuilders with high financial strength are Cavco Industries Inc. (CVCO), NVR Inc. (NVR), PulteGroup Inc. (PHM) and Skyline Champion Corp. (SKY).
Homebuilding industry overview
The homebuilding and construction industry includes companies that build and renovate a wide range of residential buildings, from single-family homes to multi-family apartments.
As the homebuilding industry lies in the consumer cyclical sector, the industry is sensitive to changes in the business cycle. During economic downturns, demand for luxury homes and residential apartments is due to decline. Additionally, the homebuilding industry
It’s not hard to tell when a stock is cheap. How can you tell if it’s timely?
One tool is the Piotroski F-Score, devised by Joseph Piotroski, a professor of accounting at University of Chicago. It rates stocks on a nine-point scale, based on nine questions. A “yes” answer to any question earns one point.
- Does the company have a positive return on assets?
- Is the return on assets higher than it was a year ago?
- Is the company’s debt ratio (long-term debt as a percentage of assets) lower than it was a year ago?
- Is the
Picking stocks that more than double the earnings return that 20-year high-quality corporate bonds grant to their possessors enhances the number of possibilities to find value opportunities.
The 20-year high-quality corporate bonds offer an average monthly spot rate of 3.49% as of Nov. 26. These securities represent corporate loans issued by triple-A, double-A and single-A companies with a very low risk of bankruptcy.
Therefore, the following stocks grant earnings return of more than 6.98% and are trading their earnings for less than 14.33 times their price. The earnings return is the inverse of the price-earnings ratio.
While the trade war between the U.S. and China persists, Europe is now in the Trump administration’s cross hairs. On Wednesday, a trade representative announced the U.S. plans to implement tariffs on $7.5 billion worth of European exports, including aircraft and agricultural products, as soon as Oct. 18.
As a result, investors may find value opportunities among consumer cyclical companies that outperformed the Standard & Poor’s 500 Index by at least 20% over the past 12 months. While companies in this sector are more sensitive to downturns, their products are still important to consumers. The GuruFocus Industry Overview page
In light of homebuilding sentiment reaching a year-to-date high, five residential construction companies most broadly held by gurus according to the Aggregated Portfolio are Lennar Corp. (LEN), D.R. Horton Inc. (DHI), PulteGroup Inc. (PHM), NVR Inc. (NVR) and Meritage Homes Corp. (MTH).
Housing Market Index reaches year-to-date high, but concerns remain
The National Association of Home Builders / Wells Fargo Inc. (WFC) Housing Market Index reached 68 for September, up 1 point from the September 2018 reading of 67 and the highest reading for the year so far. The Housing Market Index considers three components: current sales conditions, traffic
Newton’s first law says that a body in motion will maintain a constant speed and direction, unless acted on by an outside force.
Momentum investors think that a similar law applies in the stock market. If a stock has advanced strongly in the past month, or the past 52 weeks, they believe it will probably continue to do well.
I am a dyed-in-the-wool value investor. I am skeptical of momentum investing as a long-term strategy. But chasing momentum has paid off over the past 18 months or so.
Many people believe in momentum investing, some passionately. So, twice a year,
The guru added 71.79% to his Apple Inc. (AAPL) holding. The trade had an impact of 1.31% on the portfolio.
The consumer electronic devices manufacturer has a market cap of $869.60 billion and an enterprise value of $902.14 billion.
GuruFocus gives the company a profitability and growth rating of 8 out of 10. The return on equity of 49.91% and return
U.S. stocks were in negative territory on Wednesday. The Dow Jones Industrial Average fell 0.13% to 25,625, the S&P 500 index lost 0.46% to 2,805 and the Nasdaq Composite Index retreated 0.63% to 7,643.
Shares of Lennar Corp. (LEN) rose almost 4% on Wednesday after the company announced first-quarter results. Revenue grew 29.9% from the prior-year quarter to $3.87 billion, falling $230 million short of expectations. Earnings of 74 cents per share missed estimates by 2 cents.
In the first quarter, revenue from home sales rose 36% to $3.6 billion.
"We are pleased to announce our results for the first
As the market continues to demonstrate volatility heading into the final weeks of the year, CNBC reported on Monday that homebuilder sentiment declined to its lowest level since May 2015.
Following an eight-point drop in November, the National Association of Home Builders/Wells Fargo Housing Market Index said the metric declined four points in December to 56. While the index has plummeted nearly 20 points over the past year, it is still considered positive since it is above the threshold of 50. Regardless, consumers are reluctant to purchase new homes even after the recent pullback in mortgage rates.
While gurus hold positions in these companies, the stock price and returns continue to fall. These are the worst-performing stocks over the last three months with a long-term presence in more than four gurus’ portfolios.
Kellogg Co. (K) had a negative performance of 6.1% over the past six months. The stock has a total weight of 0.34% in three gurus’ portfolios.
The company operates in the manufacturing and marketing of cereal and convenience foods. It has a market cap of $21.82 billion. The stock is trading with a price-earnings (P/E) ratio of 15.16. The current stock price of
The guru acquired 200,410 shares in PulteGroup Inc. (PHM) expanding the portfolio by 1.97%.
The company is engaged in the homebuilding business. It has a market cap of $8.23 billion and an enterprise value of $14.41 billion.
GuruFocus gives the company a profitability and growth rating of 8 out of 10. The return on equity (ROE) of 10.06% and return on assets (ROA) of 4.51% are outperforming 63% of
In 1977, Paul Singer (Trades, Portfolio) founded Elliott Management Corporation. The $34 billion assets investment firm returned 13% in 2016 and has an overall net compound annual return of 14.6% compared to 10.9% of the S&P 500 Index, generated since its inception. During the third quarter the guru sold shares in the following stocks.
The guru closed his Nord Anglia Education Inc. (NORD) holding, impacting the portfolio by -0.95%.
The operator of premium international schools has a market cap of $3.39 billion and an enterprise value
It has been more than a month since Hurricanes Harvey and Irma made landfall on the Texas and Florida coasts, and things are gradually returning to normal, but the storms’ influence continues to be felt.
When the Commerce Department reported Wednesday on September housing starts, they had fallen to a one-year low. Housing starts – an indicator of economic conditions – were reported at 1.183 million in August, the second consecutive monthly decline since an uptick in June. Economists had anticipated another decline in September – to 1.175 million – but housing starts fell even more than they