Don't overlook NYSE:PHM—it's a hidden gem with strong fundamentals and an attractive price tag.

Our stock screener has spotted PULTEGROUP INC (NYSE:PHM) as an undervalued stock with solid fundamentals. NYSE:PHM shows decent health and profitability. At the same time it remains remains attractively priced. We'll dive into each aspect below.

Deciphering NYSE:PHM's Valuation Rating

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NYSE:PHM has received a 7 out of 10:

• With a Price/Earnings ratio of 9.41, the valuation of PHM can be described as very reasonable.
• Compared to the rest of the industry, the Price/Earnings ratio of PHM indicates a somewhat cheap valuation: PHM is cheaper than 72.73% of the companies listed in the same industry.
• PHM's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 28.27.
• With a Price/Forward Earnings ratio of 8.37, the valuation of PHM can be described as very reasonable.
• Based on the Price/Forward Earnings ratio, PHM is valued a bit cheaper than the industry average as 77.27% of the companies are valued more expensively.
• Compared to an average S&P500 Price/Forward Earnings ratio of 20.18, PHM is valued rather cheaply.
• Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of PHM indicates a rather cheap valuation: PHM is cheaper than 83.33% of the companies listed in the same industry.
• PHM's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• PHM has an outstanding profitability rating, which may justify a higher PE ratio.

Evaluating Profitability: NYSE:PHM

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NYSE:PHM has earned a 9 out of 10:

• With an excellent Return On Assets value of 16.52%, PHM belongs to the best of the industry, outperforming 95.45% of the companies in the same industry.
• Looking at the Return On Equity, with a value of 25.33%, PHM belongs to the top of the industry, outperforming 89.39% of the companies in the same industry.
• The Return On Invested Capital of PHM (19.66%) is better than 98.48% of its industry peers.
• The Average Return On Invested Capital over the past 3 years for PHM is significantly above the industry average of 10.12%.
• The 3 year average ROIC (18.34%) for PHM is below the current ROIC(19.66%), indicating increased profibility in the last year.
• Looking at the Profit Margin, with a value of 16.59%, PHM belongs to the top of the industry, outperforming 90.91% of the companies in the same industry.
• PHM's Profit Margin has improved in the last couple of years.
• PHM's Operating Margin of 21.45% is amongst the best of the industry. PHM outperforms 96.97% of its industry peers.
• In the last couple of years the Operating Margin of PHM has grown nicely.
• In the last couple of years the Gross Margin of PHM has grown nicely.

Health Examination for NYSE:PHM

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:PHM has received a 8 out of 10:

• PHM has an Altman-Z score of 5.60. This indicates that PHM is financially healthy and has little risk of bankruptcy at the moment.
• PHM's Altman-Z score of 5.60 is amongst the best of the industry. PHM outperforms 84.85% of its industry peers.
• PHM has a debt to FCF ratio of 1.53. This is a very positive value and a sign of high solvency as it would only need 1.53 years to pay back of all of its debts.
• With a decent Debt to FCF ratio value of 1.53, PHM is doing good in the industry, outperforming 75.76% of the companies in the same industry.
• PHM has a Debt/Equity ratio of 0.23. This is a healthy value indicating a solid balance between debt and equity.
• The Debt to Equity ratio of PHM (0.23) is better than 65.15% of its industry peers.
• PHM has a Current Ratio of 4.02. This indicates that PHM is financially healthy and has no problem in meeting its short term obligations.
• With a decent Current ratio value of 4.02, PHM is doing good in the industry, outperforming 71.21% of the companies in the same industry.
• The current and quick ratio evaluation for PHM is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

Growth Assessment of NYSE:PHM

ChartMill assigns a Growth Rating to every stock. This score ranges from 0 to 10 and evaluates the different growth aspects like EPS and Revenue, both in the past as in the future. NYSE:PHM scores a 4 out of 10:

• Measured over the past years, PHM shows a very strong growth in Earnings Per Share. The EPS has been growing by 25.08% on average per year.
• The Revenue has been growing by 9.53% on average over the past years. This is quite good.
• The Earnings Per Share is expected to grow by 8.00% on average over the next years. This is quite good.

Our Decent Value screener lists more Decent Value stocks and is updated daily.

Check the latest full fundamental report of PHM for a complete fundamental analysis.

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.