1Q loss widens for PulteGroup but homebuilder beats estimates
Homebuilder PulteGroup Inc. (PHM) posted a first-quarter loss of $40 million, or 10 cents per share, on Thursday even as traffic and orders rose during the quarter on a month-to-month basis. That compares to a net loss of $12 million, or 3 cents per share, a year earlier. Despite deepening its loss from last year, the company beat analyst estimates of a loss in the 13 cents-per-share range, which prompted a rise in the company's stock price early Thursday morning. The firm's profit fell as revenue from home sales plummeted 20% to $782 million, compared to $977 million a year earlier when the homebuyer tax credit was still buoying sales figures in the market. Total closings for 1Q fell 17% over last year, with the homebuilder closing on 3,141 homes during the period. "We are encouraged by traffic and orders within the quarter, which showed sequential increases from month-to-month, while we exceeded internal forecasts for the period on key business," said PulteGroup President and CEO Richard J. Dugas Jr. "An improving economy is slowly beginning to generate new jobs, which over the long term should translate into stronger consumer confidence, both of which are critical to a meaningful and sustained recovery in the U.S. housing industry." Dugas believes higher closing volumes are possible as the economy improves, prompting him to forecast the chance of profitability in the latter part of 2011. Write to Kerri Panchuk.