Pulte Homes posted a second-quarter loss of $507.6M ($2.01/share) as revenues skid 40% to $2B from $3.4B a year earlier amid continued deterioration in the U.S. housing market. Last year, Pulte earned $243.9M ($0.94/share) in the second quarter. Earnings were at the low-end of the $2.00-2.10/share loss range the company forecast last week (see full summary), causing shares to rise 2.1% in AH trading. Analysts were expecting a loss of $2.04/share. Previously, the Bloomfield Hills, Mich.-based homebuilder had expected results to be break-even to a $0.10/share loss, excluding charges. "As reported in our preliminary release last week, the homebuilding industry continues to face an extremely difficult environment that includes record existing and new home inventory levels, intense price competition and weak consumer sentiment for housing," said CEO Richard J. Dugas, Jr. Meanwhile on Wednesday, the chief economist for the National Association of Homebuilders lowered his forecasts for new construction. "It's fair to say the performance of the housing market during the first half [of 2007] and the outlook for the second half and next year are a lot weaker than six months ago," said David Seiders, in a mid-year housing outlook. Seiders said the "unanticipated and sudden turmoil in the subprime-mortgage sector" and still rising delinquencies and foreclosures create "massive uncertainty over where we're going." He blamed the downturn on the unsustainable boom of new housing sales that was driven by an "overly aggressive monetary policy." Looking ahead, Pulte said it expects third-quarter EPS of $0.10-0.20/share excluding charges, but that due to the lack of longer-term visibility it wouldn't provide guidance beyond that period.
Sources: Press release, MarketWatch
Commentary: Homebuilders Recovered, But Nobody Showed Up • Homebuilders Sinking Into the Subprime Mess
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