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If You Invested $1000 in PulteGroup 10 Years Ago, This Is How Much You'd Have Now

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For most investors, how much a stock's price changes over time is important. This factor can impact your investment portfolio as well as help you compare investment results across sectors and industries.

The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.

What if you'd invested in PulteGroup (PHM - Free Report) ten years ago? It may not have been easy to hold on to PHM for all that time, but if you did, how much would your investment be worth today?

PulteGroup's Business In-Depth

With that in mind, let's take a look at PulteGroup's main business drivers.

Based in Atlanta, GA, PulteGroup Inc. engages in homebuilding and financial services businesses, primarily in the United States. The company conducts operations through two primary business segments – Homebuilding (which accounted for 96.7% as of 2020 total revenues) and Financial Services (3.3%).

The Homebuilding segment offers a wide variety of home designs including single family detached, townhouses, condominiums and duplexes at different prices, with a variety of options and amenities to all major customer segments: first-time, move-up and active adult. Pulte’s brand portfolio includes Pulte move-up brand, Centex first-time brand, Del Webb active adult, DiVosta Homes and John Wieland Homes and Neighborhoods.

The company operates in approximately 40 markets in 23 states across the United States. The homebuilding division is broken down into six reportable segments; Northeast, Southeast, Florida, Texas, Midwest and West.

Pulte’s direct subsidiaries under the homebuilding segment include Pulte Diversified Companies Inc., Del Webb Corporation and Centex Corporation.

Pulte’s Financial Services business includes mortgage banking and title operations through Pulte Mortgage and other subsidiaries. Pulte Mortgage arranges financing by originating mortgage loans for homebuyers.

Bottom Line

While anyone can invest, building a lucrative investment portfolio takes research, patience, and a little bit of risk. If you had invested in PulteGroup ten years ago, you're probably feeling pretty good about your investment today.

A $1000 investment made in May 2011 would be worth $7,414.80, or a 641.48% gain, as of May 19, 2021, according to our calculations. Investors should note that this return excludes dividends but includes price increases.

Compare this to the S&P 500's rally of 207.89% and gold's return of 20.18% over the same time frame.

Looking ahead, analysts are expecting more upside for PHM.

PulteGroup reported mixed first-quarter 2021 results, wherein earnings topped the Zacks Consensus Estimate but revenues missed the same. Nonetheless, PulteGroup started 2021 on a solid note, from delivering double-digit growth in orders (up 31% year over year), revenues (up 18.9%) and earnings (up 60%) to enhanced liquidity. It also carried out a $1 billion expansion of the share repurchase authorization. Solid housing market momentum, prudent land investment strategy, focus on entry-level buyers and protecting liquidity as well as efficient management of cash flows have been benefiting PulteGroup. Shares of PulteGroup have outperformed the industry year to date. However, escalating land, labor and material costs have been a threat to PulteGroup.

Over the past four weeks, shares have rallied 6.89%, and there have been 5 higher earnings estimate revisions in the past two months for fiscal 2021 compared to none lower. The consensus estimate has moved up as well.

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