Bleak View From Pulte Homes

Discussion in 'Wall St. News' started by S2007S, Apr 26, 2007.

  1. S2007S


    Bleak View From Pulte Homes

    By TSC Staff
    4/25/2007 6:19 PM EDT

    Pulte Homes (PHM - Cramer's Take - Stockpickr - Rating) swung to a first-quarter loss that was slightly better than its pre-announcement last week, but the homebuilder also offered a weaker-than-expected forecast for the current period.

    Pulte posted a first-quarter loss of $85.7 million, or 33 cents a share, reversing a year-earlier profit of $262.6 million, or $1.01 a share.

    The results included $132.1 million in impairments and charges related to land that has lost value amid the housing downturn. Last week, Pulte estimated a first-quarter loss of 34 cents to 38 cents a share, including these charges.

    Analysts polled by Thomson Financial projected a loss of 37 cents a share.

    Pulte's revenue slid 37% to $1.87 billion, while gross margins fell to 11% from 23% last year.

    "Overall, the homebuilding environment remained challenging during the first quarter of 2007, as elevated inventory levels combined with weak consumer confidence for housing continue to place pressure on results," said Richard Dugas, president and CEO.

    For the second quarter, Pulte projected results ranging from break-even to a loss of 10 cents a share, before any land-related charges. Analysts polled by Thomson Financial had an average estimate for earnings of 6 cents a share.

    "Due to the lack of earnings visibility, difficult market conditions that exist today and uncertainty regarding possible land-related charges going forward, we are not in a position at this time to provide guidance for the remainder of 2007," Dugas said.