Insiders Are Moving Into PulteGroup

Two insiders at $6.3 billion market cap homebuilder PulteGroup (PHM have recently bought stock in the company for around $16.50 per share. After rising sharply in 2012 on reports of a stronger housing market, many homebuilders have cooled this year and PulteGroup is no exception. The stock has suffered a 12% correction, year-to-date, against a rising market (the stock is still up about 150% since the beginning of last year). The stock dropped about 10% in late July after missing earnings for the second quarter of 2013.

Specifically, adjusted earnings per share of $0.26 were a bit below consensus of $0.30. Pretax income actually came close to doubling compared to the second quarter of 2012 -- after we add back noncore income and expenses (off of 20% revenue growth) -- but analysts had been expecting an even stronger performance from the company. PulteGroup generated about $340 million in cash from its operations during the first half of 2013, and with the company making very few capital expenditures relative to that figure, management was able to use this cash to partially pay down PulteGroup's senior notes and other debt....446 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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