PHM - Homebuilders Pulte And M/I Homes: Well Worth The Risk At These Prices
- With earnings yields of 15% for Pulte Homes and 23% for M/I Homes, these stocks trade like 30-50% EPS declines are around the corner.
- Homebuilders are at risk to a decline in new home demand from slowing population growth, but I see a number of offsets.
- Homebuilders are also at risk of excess competition trying to grab growth, a risk I will be watching over the next year.
- Net/net, I expect flat EPS over the next five years, making Pulte (PHM) and M/I (MHO) cheap despite the risks.
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Homebuilders Pulte And M/I Homes: Well Worth The Risk At These Prices