PHM - PulteGroup: Buy. Housing Is In A Bullish Shortage Not A Bearish Bubble

• The sharp rise in home prices and new home sales over the past two years is due to a record housing shortage.
• There is little evidence that the housing boom was due to debt-driven excess demand.
• Pulte had an excellent Q1 despite the fact that supply chain problems restricted construction and made Pulte turn away sales.
• I expect Pulte to earn $11 this year and $9 a share the next year.
• Despite this good news, Pulte is at a historically low valuation. The stock, therefore, has a large upside as housing fears dissipate.

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