Goldman Sachs Bullish on PulteGroup (PHM) On Turnaround Progress

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June 22, 2011 8:52 AM EDT
Get Alerts PHM Hot Sheet
Price: $127.83 -2.18%

Rating Summary:
    21 Buy, 9 Hold, 4 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 10 | Down: 12 | New: 20
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Goldman Sachs reiterated its Conviction Buy list rating and $10 price target on PulteGroup (NYSE: PHM) following a meeting with CEO Richard Dugas which left them "encouraged about the company's turnaround and future earnings potential."

The firm notes the the home-builder is in the early stages of a turnaround that will add 300-500 bps to gross margins on SG&A cost cuts and significantly tighter control of capital.

The $100 million 2011 SG&A cuts seem "more achievable" and Goldman believes their is upside potential to 2011-12 estimates due to recent consolidation of divisions from 4 to 3.

For more ratings news on PulteGroup click here and for the rating history of PulteGroup click here.

Shares of PulteGroup closed at $7.46 yesterday.

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