PulteGroup to Report Q3 Earnings: What's in Store for This Homebuilder?

PulteGroup Inc. PHM is scheduled to report its third-quarter 2025 results on Oct. 21, before the opening bell.

In the last reported quarter, the company’s earnings per share (EPS) and revenues beat the Zacks Consensus Estimate by 3.8% and 0.8%, respectively. On the contrary, both metrics declined year over year by 15.4% and 4.3%, respectively.

PulteGroup’s earnings have topped the consensus mark in each of the trailing four quarters, with an average surprise of 6%.

Trend in PHM’s Estimate Revision

The Zacks Consensus Estimate for the to-be-reported quarter’s EPS has remained unchanged at $2.86 in the past 30 days. The estimated figure indicates a 14.6% decrease from the year-ago EPS of $3.35.

The consensus mark for revenues is pegged at $4.30 billion, implying a 4% year-over-year decline.

Factors Likely to Shape PulteGroup’s Q3 Earnings

Revenues

PulteGroup's third-quarter top line is likely to have decreased year over year, primarily due to the ongoing affordability challenges in the housing market. The company is likely to have faced pressure from still-high mortgage rates, which continue to impact homebuyers. With the increasing housing inventory levels in the market and the lingering macro risks, the company’s revenue scale is likely to have been compromised, thereby reducing leverage.

Although its balanced operating model, mortgage rate buydown program and favorable home pricing are likely to have supported its underlying prospects, the current uncertainties surrounding the housing market are expected to have overshadowed the top-line performance.

PHM expects home closings to be approximately 7,200-7,600 units, down from 7,924 units a year ago. Our model predicts home closings to decline 7.4% year over year to 7,336 units.

Segment-wise, for the third quarter of 2025, our model predicts overall Homebuilding revenues (which contributed 97.7% to total revenues in the second quarter of 2025) to decrease 4.7% year over year to $4.16 billion, due to lower home closings. Our model expects financial services revenues (which contributed 2.3% to total revenues in the second quarter) to increase 13.6% year over year to $129.3 million.

However, PulteGroup’s emphasis on entry-level homes, disciplined land investments and a portfolio of affordable offerings likely provided some support to its revenue performance. The company’s pricing approach remains centered on maintaining affordability for homebuyers while adapting to evolving market conditions. The company expects a higher average selling price (ASP) for the quarter between $560,000 and $570,000 compared with the year-ago level of $548,000. Our model predicts the ASP of homes closed to increase 2.5% year over year to $$561,500.

Margins

PulteGroup is likely to have faced significant margin pressure in the third quarter, due to the need for incentives to manage affordability concerns while maintaining profitability. The company's bottom line is expected to have decreased year over year in the third quarter, due to higher incentive costs stemming from competitive market dynamics. That said, prudent cost-saving efforts are likely to have partly mitigated the risks.

The company expects home sales gross margin to be between 26% and 26.5% for the quarter, down from 28.8% reported in the year-ago period. Our model predicts homebuilding gross margin to be 26.3% for the quarter, down 250 basis points from the year-ago period.

Orders & Backlogs

Our model expects PHM’s net new orders to increase 4% year over year to 7,309 units in the quarter. We expect the total backlog to decline 11.1% to 10,751 units, with the total backlog value declining 10.9% year over year to $6.85 billion.

PulteGroup, Inc. Price and EPS Surprise

PulteGroup, Inc. price-eps-surprise | PulteGroup, Inc. Quote

What the Zacks Model Unveils for PHM

Our proven model does not conclusively predict an earnings beat for PulteGroup this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case here.

Earnings ESP: PHM has an Earnings ESP of 0.00%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company currently carries a Zacks Rank #3.

Stocks With the Favorable Combination

Here are some stocks from the Zacks Construction sector, which, per our model, have the right combination of elements to deliver an earnings beat this time around.

Armstrong World Industries, Inc. AWI has an Earnings ESP of +0.63% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

The company’s earnings beat estimates in each of the last four quarters, the average surprise being 9.9%. Armstrong World’s earnings for the third quarter of 2025 are expected to increase 9.9%.

TopBuild BLD currently has an Earnings ESP of +1.89% and a Zacks Rank of 3.

The company’s earnings beat estimates in all the last four quarters, the average surprise being 2.8%. TopBuild’s earnings for the third quarter of 2025 are expected to tumble 8.1%.

EMCOR Group EME currently has an Earnings ESP of +0.20% and a Zacks Rank of 2.

The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 16.8%. EMCOR’s earnings for the third quarter of 2025 are expected to increase 14.7%.

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This article originally published on Zacks Investment Research (zacks.com).

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