PulteGroup misses revenue estimates as home sales slow


(Reuters) – PulteGroup missed Wall Street estimates for fourth-quarter revenue on Tuesday, as it sold fewer homes at lower prices to offset a hit to demand from higher mortgage rates.

The 30-year fixed mortgage rate rose to nearly 8% in the fourth quarter, the highest in two decades, prompting potential homeowners to put off their purchase plans.

Pulte reported revenue of $4.29 billion, missing expectations of $4.47 billion, according to LSEG data.

The third-largest U.S. homebuilder by volume sold 7,615 homes in the quarter, down 13.9% from the prior year, and reported a 2.5% drop in average selling prices. Homes sold were also below the company’s estimate of 8,000.

Its gross margins of 28.9% also came in below its forecast of 29-29.5%, mirroring a similar trend at D.R. Horton.

Atlanta-based Pulte reported net income of $3.28 per share, compared with analysts’ average estimate of $3.22 per share.

The company also said it would buy back shares worth $1.5 billion.

Shares of the company fell 1% to $105 in premarket trading.

(Reporting by Ananta Agarwal, Rupali Chaudhary and Aishwarya Jain; Editing by Shinjini Ganguli and Anil D’Silva)

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