#4 S&P Stock: PulteGroup
YTD Gain: 66%
The housing market clearly is not going like gangbusters right now. But that hasn’t held back homebuilder stock PulteGroup (NYSE:PHM). Why? Well, because investors know there’s no better time to buy a stock than at the bottom — and many feel like we are at or near a bottom in homebuilders.
The gains haven’t been limited to PulteGroup. Smaller builders Ryland Group (NYSE:RYL) and M/I Homes (NYSE:MHO) have both tallied similar gains year-to-date. That’s because there seems to be optimism about the state of the housing market based on recent positive housing data. There also are hopes that consumer finances are slowly mending and low interest rates will incite buyers.
Fundamentally, PHM isn’t much to write home about. It just posted a loss in Q1, and revenue remains down significantly from just a few years ago let alone the peak performance before the financial crisis. But investors clearly are making a directional bet on housing right now, and PHM has soared as a result.