Shares of U.S. homebuilders rose on Tuesday amid signs that a dearth of existing homes for sale and resilient demand in the face of high interest rates are buoying earnings.
PulteGroup (PHM), one of America’s largest homebuilders, reported profit increased 32% to $3.10 per share in the first quarter, well ahead of the $2.37 consensus estimate among analysts surveyed by Visible Alpha. Home sales revenue increased 10% to $3.8 billion in the period, driven by an 11% increase in closings.
“After more than a decade of underbuilding, it is estimated that our country has a structural shortage of several million homes,” said President and CEO Ryan Marshall in the company’s earnings release. “Given PulteGroup’s broad operating platform and deep product portfolio … we are well positioned to expand our market share while helping to provide much needed new housing stock.”
But underbuilding isn’t the only reason buyers are increasingly turning to new homes …