10 Best Residential Real Estate Stocks To Buy

7. PulteGroup, Inc. (NYSE:PHM)

Number of Hedge Fund Holders: 35

PulteGroup, Inc. (NYSE:PHM) is one of America’s largest homebuilders with operations in over 40 major cities. It was founded in 1950 and has delivered almost 750,000 homes across the country. The homebuilder caters to first-time, move-up, and active-adult homebuyers through its brands Pulte, Centex, Del Webb, DiVosta, American West, and John Wieland Homes and Neighborhoods. Through its financial services segment, the company offers mortgage financing and title agency services.

Through a portfolio of industry-leading brands, Pulte serves buyers at every stage of their lives. The Del Webb and DiVosta brands are the recognized leaders for buyers over 55. First-time homebuyers can seek value for their money in a Centex home and the luxury homebuilder John Wieland Homes and Neighborhoods offers new construction and neighborhoods in some of the most desirable locations. These brands position the firm well in the market.

Pulte recently reported another quarter of overall strong financial performance. During the second quarter, earnings increased 19% to $3.83 per share and home sale revenues increased 10% to $4.4 billion. Ryan Marshall, President and Chief Executive Officer of PulteGroup, mentioned the structural shortage of homes due to underbuilding as a favorable dynamic that is rather long-term. For the trailing 12 months, the firm’s return on equity of 27.1% reflects how it efficiently navigated the market conditions.

Pulte is in a good position to drive strong results going forward. While the home builder will be growing its community count growth given the strength of its land pipeline, it continues to start homes at a pace consistent with closing 31,000 homes this year. The company will also be undergoing a transition for its CFO succession planned for February 2025. The new CFO Jim Ossowski, currently Senior Vice President of Finance, has a tremendous 22-year career at the company.

Pulte benefits from one of the leading positions in the US housing market, prevailing market conditions, a portfolio of leading brands, and a strong financial performance. Additionally, PulteGroup, Inc. (NYSE:PHM) is currently cheap as it trades at 11 times its forward earnings, a discount of 34.36% to the sector. The stock ranks 7^th among the 10 best residential real estate stocks to buy.