PulteGroup is expected to report narrower margins Wednesday morning, but analysts maintain a broadly steady outlook for the large home builder, predicting resilient demand.

The earnings will give Wall Street its next look at how home builders are navigating high mortgage rates, high home prices, and shifting buyer demand, all of which are creating uncertainty throughout the market.

Analysts are forecasting earnings of $2.36 a share on revenue of $3.9 billion for the company's fiscal second quarter, according to a FactSet poll, down year over year from earnings of $3 on $4.4 billion in revenue last June.

Wall Street is anticipating that the homebuilder's gross margin will fall, too. Analysts expect PulteGroup to post a 24.3% margin, a 2.7% drop year over year, with delivery units falling to 7,029 year over year.

"PHM has executed its operating and capital strategy well in a challenging market, effectively managing the pace vs. price dynamic to keep inventory turning without overly diluting margin," Ryan Gilbert, an analyst at BTIG, wrote in a Tuesday note.

Across the board, volatile mortgage rates and relatively high home prices have led to declines in consumer confidence and hit home buyers with greater uncertainty. Thirty-year fixed mortgage rates hit 6.55% this week, reflecting lingering upward pressure, and while purchase application demand has weakened recently, housing affordability and inventory are improving modestly.

Construction costs, too, have edged higher, UBS analyst John Lovallo wrote in a July 15 note. "We believe the public builders remain very well positioned to offset these pressures by pushing back on suppliers, tightening cycle times, pursuing value engineering, and attracting lower cost labor."

New-orders units will likely reflect sustained demand, analysts say, and are expected to hit 7,383, a 4.2% climb year over year.

Keep an eye on guidance. Analysts are expecting earnings per share of $2.78 in the third quarter on revenue of $4.4 billion. D.R. Horton reduced its full-year guidance Tuesday despite posting better-than-expected third-quarter results, leaving investors waiting apprehensively for PulteGroup results.

As of Tuesday, PulteGroup stock was up 4.76% year to date -- better than D.R. Horton stock and the iShares U.S. Home Construction exchange-traded fund but significantly lagging behind small and medium-sized builders. Beazer Homes USA, LGI Homes, and Hovnanian Enterprises are up 60%, 36%, and 35%, respectively this year, according to FactSet.

Smaller builders have outperformed larger ones in the wake of Berkshire Hathaway's deal to buy midsized Taylor Morrison at a 24% premium over its share price. Investors are now rushing to buy shares of undervalued small builders.

Write to Molly Bordoff at molly.bordoff@barrons.com

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July 21, 2026 16:09 ET (20:09 GMT)

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