2-Star Stocks Poised to Plunge: PulteGroup?

Before you go, we thought you'd like these...
Before you go close icon

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, homebuilder PulteGroup (NYS: PHM) has received a distressing two-star ranking.

With that in mind, let's take a closer look at PulteGroup's business and see what CAPS investors are saying about the stock right now.

PulteGroupfacts

Headquarters (founded)Bloomfield Hills, Mich. (1956)
Market Cap$4.9 billion
IndustryHomebuilding
Trailing-12-Month Revenue$4.4 billion
ManagementChairman/CEO Richard Dugas, Jr.
CFO Robert O'Shaughnessy
Return on Equity (average, past 3 years)(22.2%)
Cash/Debt$1.3 billion / $3.2 billion
CompetitorsD. R. Horton
KB Home
Lennar

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 54% of the 1,268 members who have rated PulteGroup believe the stock will underperform the S&P 500 going forward.

Earlier this week, one of those Fools, All-Star Chemdawg, succinctly summed up the PulteGroup bear case for our community:

Debt still too high and its [share price] went up basically because of future expectations ... theres a lot of time to go before they show strong growth ... still cash flow negative ... still tons of shadow inventory here in Florida ... it may have bottomed for the most part, but banks are still not lending ... and most people dont pay cash for new homes ... even those with the means to do so.

If you want market-topping returns, you need to protect your portfolio from any undue risk. Luckily, we've found another stock we are incredibly excited about -- excited enough to dub it "The Motley Fool's Top Stock for 2012." We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won't be here forever, so click here to access it now.

Want to see how well (or not so well) the stocks in this series are performing? Follow theTrackPoisedToCAPS account.

The article 2-Star Stocks Poised to Plunge: PulteGroup? originally appeared on Fool.com.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners