Pulte Homes Inc (PHM)

[PennyP1cker]

Demand was strong across the US, including Massachusetts, Texas, Nevada, Arizona and California.

New orders rose 14% to 4,805 homes and by 22% to $2 billion.

However, adjusted gross margin fell to 23.8% vs. 24.9% a year earlier as wages rise and commodity prices climb.

PulteGroup also announced a $500 million stock buyback program. It'll be added to its existing plan, which has $94 million remaining.

Outlook: Management expects demand in the housing sector to continue to improve with the active adult and entry level markets were cited as growth areas. But Pulte sees margins squeezed further due to increasing labor and material costs, with lumber and concrete highlighted as particular concerns. "There remain many positive forces pushing the market higher," President and CEO Ryan Marshall said during the earnings call. "Employment trends are favorable and wages are showing signs of growth."

by Michael Larkin IBD