AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-3: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 4/6 · 31/10/2026
Moat31
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
structural advantage · 1/4 · Geographic scale, financing capacity and land options provide current flexibility. Comparative financing superiority remains management's assertion. Robust land competition and falling orders despite concessions and additional communities demonstrate weak economic protection, rather than merely an absence of peer research.
durability · 1/4 · Long-dated financing and land-option flexibility support business continuity, but do not establish a durable moat. Earlier net-pricing resilience gave way to concessions, continuing land-cost pressure and realized impairments. Del Webb's differentiated format lacks demonstrated persistent premiums or customer dependency.
customer dependency · 1/4 · Deposits create limited transaction friction, but financing contingencies and potential final negotiations allow customer exits. Improved second-quarter cancellations indicate some order persistence, assessed indirectly. Neither these contracts nor amenitized communities demonstrate durable repeat demand or strong dependency on PulteGroup.
erosion resilience · 2/4 · Lower speculative inventory mix, improved production cycles and available revolving capacity demonstrate adaptation. Nevertheless, third-quarter orders declined despite concessions and community expansion, while gross margin fell sequentially and year over year. These outcomes support partial resilience, with little evidence of protection from competitive erosion.
Pricing power44
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 1/4 · Net pricing substantially offset costs in 2023–2024, but that resilience weakened. The 2025 selling-price increase primarily reflected mix and was offset by incentives. Third-quarter 2026 concessions accompanied a 1% decline in closing average sales price and falling orders; comparable-home price changes are not isolated.
retention · 2/4 · Cancellation rates, defined as canceled orders divided by gross new orders, improved to 13% in both second-quarter and first-half 2026 from 15% and 14%, respectively. September backlog exceeded the prior year. These are indirect persistence indicators; concessions, cancellation rights and missing third-quarter cancellation data limit the conclusion.
margin resilience · 2/4 · Earlier net pricing absorbed much of rising costs, and inventory and cycle-time adjustments show operational flexibility. Protection subsequently weakened: third-quarter 2026 gross margin was 24.8%, versus 26.2% a year earlier and 25.0% sequentially, including approximately 70 basis points of land impairments. Resilience is mixed.
contractual freedom · 2/4 · Implemented sales-price adjustments, discounts, closing-cost incentives and mortgage buydowns demonstrate discretion over new-sale terms. Deposit-retention rights provide some contractual protection. Financing cancellation contingencies and final negotiations constrain that protection, while the catalog does not establish unilateral repricing rights for already-contracted homes.
Predictability85
5 consecutive published annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 50.00
- Revenue growth volatility (pp)
- 8.43
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 3.25
- observedAnnualPeriods
- 5.00
Financial strength—
Missing required inputs: interestCoverageGrade, currentRatioGrade. Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, an original issuer-reported unadjusted EBIT reconciled to net income, income tax and signed net interest, or reported pretax profit plus reported gross interest expense. Reported EBIT is distinct from GAAP operating income and gross interest. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 100.00
- netDebtEbitGrade
- 100.00
- Debt / FCF (x)
- 0.03
Capital allocation—
Missing required inputs: operatingReturn. Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income, an original issuer-reported unadjusted EBIT reconciled to net income, income tax and signed net interest, or EBIT calculated from reported pretax profit plus reported gross interest expense; the issuer-reported EBIT is distinct from GAAP operating income and gross interest; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. ROIC remains undefined for nonpositive invested capital; the explicit asset-return alternative does not change the ROIC chart. Missing financial inputs alone never trigger an alternative. Does not establish acquisition quality or buyback timing.
- 3-year average dilution (%)
- -5.56
- 3-year average SBC / revenue (%)
- 0.31
- cashConversionGrade
- 68.51
Management63
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Land-option exits and completed refinancing demonstrate active capital management. However, nine-month 2026 operating cash flow of $637.0 million fell from $1.100 billion; inventory absorbed $1.149 billion, while repurchases and paid dividends exceeded operating cash generation. Available credit, stronger 2025 cash generation and fourth-quarter seasonality temper concerns. Repurchase value creation remains unproven.
incentive alignment · 3/4 · Existing multiyear equity vesting, ownership requirements, hedging restrictions and clawbacks provide strong alignment mechanisms. Completed 2023–2025 performance awards had an actual payout linked to relative TSR, ROIC and operating margin. Continuing executives either met ownership guidelines or remained within the compliance period; universal achieved compliance and exceptional effectiveness are not established.
execution · 2/4 · Reduced speculative inventory mix, improved production cycles and higher year-over-year September backlog demonstrate operating adaptation. Missed 2025 revenue and profit targets, declining third-quarter orders despite more communities, and weaker margins limit the assessment. Execution is judged from these operating outcomes rather than management confidence or compensation payouts.
governance · 3/4 · Disclosed independent board leadership and committees, annual elections, shareholder action rights and a restatement clawback establish strong formal governance. Actual 2026 director elections and management's September controls conclusion add current evidence. The passages do not establish exceptional oversight effectiveness or demonstrated recovery-policy enforcement.
Evidence
Strategy
We believe that national publicly-traded builders have a competitive advantage over local builders through their ability to: access more reliable and lower cost financing through the capital markets; control and entitle large land positions; gain better access to scarce labor resources; and achieve greater geographic and product diversification.
2025 Form 10-K, filed 2026-02-04; Business—Strategy, asserted national-builder advantages · Filed 04/02/2026
27
Homebuilding Segment Operations
As of September 30, 2026, we conducted our operations in 48 markets located throughout 26 states.
Third-quarter 2026 Form 10-Q, filed 2026-10-22; Homebuilding Segment Operations—geographic scope · Filed 22/10/2026
As of September 30, 2026, PulteGroup, Inc.
Third-quarter 2026 Form 10-Q; Supplemental Guarantor Financial Information—September 30, 2026 measurement date · Filed 22/10/2026
had outstanding $1.8 billion principal amount of unsecured senior notes due at dates from March 2031 through March 2036 and no borrowings outstanding, $368.3 million of letters of credit issued, and $1.4 billion of remaining capacity under its Revolving Credit Facility.
Third-quarter 2026 Form 10-Q; Supplemental Guarantor Financial Information—senior notes, letters of credit and revolving capacity, dated by e3 · Filed 22/10/2026
We have also continued to seek to maintain a high percentage of our lots that are controlled via land option agreements as such contracts enable us to defer acquiring portions of properties owned by third parties or unconsolidated entities until we have determined whether and when to exercise our option, which reduces our financial risks associated with long-term land holdings.
Third-quarter 2026 Form 10-Q; controlled lots—land-option contractual flexibility · Filed 22/10/2026
14,783
17,032
31,815
16,220
19,162
35,382
West
25,681
12,447
38,128
26,192
14,640
40,832
Total
101,760
122,515
224,275
101,104
133,528
234,632
45
%
55
%
100
%
43
%
57
%
100
%
Developed (%)
50
%
26
%
37
%
50
%
25
%
36
%
While competition for well-positioned land is robust, we have continued to pursue land investments that we believe can achieve appropriate risk-adjusted returns on invested capital.
Third-quarter 2026 Form 10-Q; controlled-lot table continuation and explicit competition for well-positioned land · Filed 22/10/2026
We have continued responding to these conditions by adjusting production cadence and sales prices where necessary and focusing sales incentives on discounts, closing cost incentives, and mortgage interest rate buydowns.
Third-quarter 2026 Form 10-Q; MD&A—implemented price adjustments and sales incentives · Filed 22/10/2026
Despite these pricing actions, net new orders in units decreased 6% compared to the prior year period.
Third-quarter 2026 Form 10-Q; MD&A—net new unit orders declined despite pricing actions · Filed 22/10/2026
However, we continue to face pressure in the cost of land acquisition and development.
Third-quarter 2026 Form 10-Q; MD&A—continued land acquisition and development cost pressure · Filed 22/10/2026
Consolidated Statements of Cash Flows
($000's omitted)
(Unaudited)
Nine Months Ended
September 30,
2026
2025
Cash flows from operating activities:
Net income
$
1,294,726
$
1,717,115
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income tax expense
24,524
51,921
Land-related charges
65,030
69,811
Loss on debt retirement
2,637
—
Depreciation and amortization
76,626
75,549
Equity income from unconsolidated entities, net
(2,069)
(3,333)
Distributions of income from unconsolidated entities
4,758
3,060
Share-based compensation expense
44,718
43,221
Other, net
(21,494)
(739)
Increase (decrease) in cash due to:
Inventories
(1,149,355)
(635,860)
Residential mortgage loans available-for-sale
179,718
143,516
Other assets
(127,060)
(203,007)
Accounts payable, accrued and other liabilities
244,207
(161,132)
Net cash provided by operating activities
636,966
1,100,122
Cash flows from investing activities:
Capital expenditures
(78,221)
(91,401)
Investments in unconsolidated entities
(45,773)
(9,171)
Distributions of capital from unconsolidated entities
21,564
45,669
Proceeds from asset dispositions
90,587
2,799
Other investing activities, net
3,000
(12,000)
Net cash used in investing activities
(8,843)
(64,104)
Cash flows from financing activities:
Proceeds from debt issuance
794,784
—
Repayments of notes payable
(612,691)
(9,163)
Financial Services repayments, net
(149,093)
(122,683)
Debt issuance costs
(23,411)
(1,446)
Proceeds from liabilities related to consolidated inventory not owned
26,558
25,643
Payments related to consolidated inventory not owned
(31,633)
(32,981)
Share repurchases
(1,031,567)
(900,000)
Excise tax on share repurchases
(11,482)
(11,550)
Cash paid for shares withheld for taxes
(39,557)
(24,303)
Dividends paid
(150,780)
(133,658)
Net cash used in financing activities
(1,228,872)
(1,210,141)
Net increase (decrease) in cash, cash equivalents, and restricted cash
(600,749)
(174,123)
Third-quarter 2026 earnings release, filed 2026-10-22; unaudited consolidated cash flows, nine months ended September 30, 2026 and 2025, $000's omitted · Filed 22/10/2026
The Company’s reported third quarter gross margin is inclusive of $26 million, or approximately 70 basis points, of land impairments recorded in the period.
Third-quarter 2026 earnings release; reported quarterly gross margin includes land impairments · Filed 22/10/2026
Through our Del Webb brand, we address the needs of active adults.
2025 Form 10-K; Business—Del Webb active-adult positioning · Filed 04/02/2026
Many of these active adult communities are age-restricted to homebuyers aged fifty-five and over and are highly amenitized, offering a variety of features, including athletic facilities, recreational centers, and educational classes, to facilitate the homebuyer maintaining an active lifestyle.
2025 Form 10-K; Business—active-adult age restrictions and amenities · Filed 04/02/2026
In order to make the cost of these highly amenitized communities affordable to the individual homeowner, Del Webb communities tend to be larger than first-time or move-up homebuyer communities.
2025 Form 10-K; Business—community size and amenity affordability · Filed 04/02/2026
Our sales contracts also typically include a financing contingency that provides customers with the right to cancel if they cannot obtain mortgage financing at specified interest rates within a specified period.
2025 Form 10-K; Business—customer financing cancellation contingency · Filed 04/02/2026
Of the orders in backlog at December 31, 2025, substantially all are scheduled to be closed during 2026, though all orders are subject to potential cancellation by or final negotiations with the customer.
2025 Form 10-K; Business—December 31, 2025 backlog subject to cancellation or final negotiation · Filed 04/02/2026
In the event of contract cancellation, the majority of our sales contracts stipulate that we have the right to retain the customer’s deposit, though we may choose to refund the deposit in certain instances.
2025 Form 10-K; Business—contractual right to retain deposits and discretionary refunds · Filed 04/02/2026
Cancellation rates (canceled orders for the period divided by gross new orders for the period) were 13% for both the three and six months ended June 30, 2026, and 15% and 14% for the three and six months ended June 30, 2025, respectively.
Second-quarter 2026 Form 10-Q, filed 2026-07-22; cancellation-rate definition and three- and six-month comparisons · Filed 22/07/2026
Average selling price increased primarily due to product and geographic mix, including a slightly higher mix of closings toward our move-up buyers and in our Northeast segment, both of which carry a higher average selling price, partially offset by higher sales incentives.
2025 Form 10-K; MD&A—average selling-price change attributed primarily to product and geographic mix · Filed 04/02/2026
The lower home sale gross margins were primarily attributable to the aforementioned pricing actions we took in 2025, including elevated sales incentives, increased land acquisition and development costs, and higher land impairments as the result of the more challenging market conditions.
2025 Form 10-K; MD&A—realized margin pressure from pricing actions, land costs and impairments · Filed 04/02/2026
Due to the low supply of new and existing homes for sale, we were generally able to maintain net sales pricing to substantially offset increases in house and land costs and higher sales incentives over these periods.
2024 Form 10-K, filed 2025-02-06; MD&A—2023–2024 net pricing substantially offset cost increases and higher incentives · Filed 06/02/2025
Home sale revenues in the third quarter reflect a 9% decrease in closings to 6,876 homes, in combination with a 1% decrease in the average sales price of homes closed to $561,000.
Third-quarter 2026 earnings release; quarterly closing-volume and average sales-price changes · Filed 22/10/2026
Our gross margin decreased to 24.8% in the third quarter of 2026 versus 26.2% in the third quarter of 2025, and 25.0% in the second quarter of 2026.
Third-quarter 2026 Form 10-Q; MD&A—quarterly gross-margin comparisons · Filed 22/10/2026
We have successfully lowered our mix of spec home inventory.
Third-quarter 2026 Form 10-Q; MD&A—reported reduction in speculative inventory mix · Filed 22/10/2026
This decrease was primarily due to our focus on reducing the number of spec homes and improved production cycle times, which reduces the length of time a home remains under construction.
Second-quarter 2026 Form 10-Q; homes in production—reduced speculative homes and improved production cycle times · Filed 22/07/2026
For its third quarter, the Company’s average community count totaled 1,077, or an increase of 7% from the prior year period.
Third-quarter 2026 earnings release; quarterly average community count and year-over-year growth · Filed 22/10/2026
At the end of the third quarter, the Company’s backlog was 10,298 homes with a value of $6.4 billion.
Third-quarter 2026 earnings release; quarter-end backlog units and value · Filed 22/10/2026
The Company ended last year’s third quarter with a backlog of 9,888 homes with a value of $6.2 billion.
Third-quarter 2026 earnings release; prior-year third-quarter backlog units and value · Filed 22/10/2026
Specifically, we: Delivered a return on equity of 18%*; Continued activity under our share repurchase program, including the repurchase of $1.2 billion of shares in 2025; Increased our quarterly dividend by 18% to $0.26 per share effective for dividends paid beginning in 2026; and Generated $1.9 billion of operating cash flows in 2025.
2026 proxy, filed 2026-03-13; reported 2025 cash generation, repurchases and dividend increase · Filed 13/03/2026
Accordingly, we are focused on protecting liquidity and closely managing our cash flows while also continuing to emphasize shareholder returns, including the following actions: –Emphasizing our lot optionality within our land pipeline for increased flexibility; –Updating the underwriting for our land option contracts prior to buying additional land, and we have made decisions to walk away from a number of land option agreements; –Working with our trade partners to update the costs for materials, labor, and services to reflect changes in market conditions; –Adjusting our overhead cost structure as necessary to align with demand; –Rebalancing our mix of spec versus sold home inventory to continue to service buyers seeking to close within 30 to 90 days while increasing our backlog of build-to-order homes; –Maintaining a focus on shareholder return through share buybacks and dividends, including $681.2 million of share repurchases in the first six months of 2026 and an 18% increase in our quarterly dividends from $0.22 to $0.26 per share effective with our January 2026 dividend payment; 24 –Opportunistically extending and expanding our revolving credit facility while also issuing $800.0 million of senior notes at lower interest rates than the $589.1 million of senior notes repaid and redeemed in the first three months of 2026; and –Maintaining ample liquidity.
Second-quarter 2026 Form 10-Q; MD&A—land-option exits, inventory management, distributions and completed refinancing · Filed 22/07/2026
We generally experience increases in revenues and cash flow from operations in the fourth quarter based on the timing of home closings.
Third-quarter 2026 Form 10-Q; liquidity—historical fourth-quarter concentration of revenue and operating cash flow · Filed 22/10/2026
WHAT WE DO WHAT WE DO NOT DO Annual say-on-pay vote Shareholder engagement Compensation and Management Development Committee comprised entirely of independent directors Independent outside compensation consultant Pay for performance—CEO pay approximately 94% variable Multi-year vesting schedule for equity awards Meaningful share ownership guidelines Clawback policies for both financial restatements and executive misconduct Market comparison of executive compensation against a relevant peer group Primarily use different metrics for short-term and long-term incentive programs Prohibition on hedging and pledging Company securities No dividends or dividend equivalents paid on unearned performance-based equity awards No automatic single-trigger vesting of equity awards upon a change-in-control No change-in-control tax gross-ups for named executive officers No excessive perquisites No service-based defined benefit pension plan Plan prohibits re-pricing of underwater stock options Plan prohibits granting discounted stock options No fixed term employment agreements Shareholder Feedback In its compensation review process, the Committee considers whether our executive compensation and benefits program serves the interests of our shareholders.
2026 proxy; existing executive compensation practices, multiyear vesting, ownership guidelines and hedging restrictions · Filed 13/03/2026
We achieved 194.52% performance with respect to the relative total shareholder return (“TSR”), and 200% performance on each of the return on invested capital (“ROIC”) and operating margin metrics applicable to the 2023-2025 performance-based equity awards, resulting in a payout of 198.17% of target.
2026 proxy; completed 2023–2025 performance-equity award results and actual payout relative to target · Filed 13/03/2026
The share ownership guidelines require, within a five-year period from date of hire, promotion or determination that a position is subject to Section 16 of the Exchange Act, the Chief Executive Officer to own Company common shares equal in value to at least six times his base salary and each of the other named executive officers to own Company common shares equal to at least three times their respective base salary.
2026 proxy; executive ownership requirements and five-year compliance period · Filed 13/03/2026
As of the record date, all of the continuing named executive officers have either met the share ownership guidelines or are within the five-year period to become in compliance with the guidelines.
2026 proxy; continuing named executive officers' ownership compliance or remaining compliance period · Filed 13/03/2026
Despite not achieving our revenue and profit targets for 2025, the execution of these strategies helped us navigate 2025's challenging operating environment and deliver industry-leading TSR within our peer group in 2025.
2026 proxy; acknowledgment that 2025 revenue and profit targets were not achieved · Filed 13/03/2026
In particular, we believe that the following corporate governance features help us best serve the interests of our shareholders: Shareholder Rights Annual election of all directors Majority vote standard in uncontested director elections Right to call a special meeting for shareholders with 20% or more of outstanding shares Right to take action by written consent for shareholders Active engagement with the Company’s top 20 largest shareholders Independent Oversight Strong Independent Chairman role Audit Committee, Compensation and Management Development Committee and Nominating and Governance Committee each comprised solely of independent directors All directors are independent except the Chief Executive Officer Committees have authority to retain independent advisors Good Governance Frequent cross-committee and Board communications Regular Board, committee and director evaluation processes Code of ethical business conduct and code of ethics Director orientation and continuing education programs Meaningful share ownership guidelines for executive officers and directors Prohibition against hedging and pledging Company securities by all employees and directors Charter of Nominating and Governance Committee expresses strong commitment to inclusion of diverse knowledge, experience and viewpoints in selection of Board nominees iv PULTEGROUP, INC.
2026 proxy; shareholder rights, independent board leadership and independent committees · Filed 13/03/2026
In addition, the Company maintains an additional compensation recovery, or “clawback,” policy for cash and equity incentive awards paid to executive officers providing for the recovery of applicable incentive-based compensation from current and former executive officers of the Company in the event the Company is required to restate its financial results due to the Company’s material non-compliance with any financial reporting requirement under the federal securities laws as required by the Dodd-Frank Act and corresponding NYSE listing standards.
2026 proxy; existing financial-restatement compensation recovery policy · Filed 13/03/2026
Based upon, and as of the date of that evaluation, our President and Chief Executive Officer and Executive Vice President and Chief Financial Officer concluded that the disclosure controls and procedures were effective as of September 30, 2026.
Third-quarter 2026 Form 10-Q; management conclusion on disclosure controls as of September 30, 2026 · Filed 22/10/2026
The matters submitted to a vote by the Company’s shareholders and the voting results of such matters are as follows:
Proposal 1 - Election of Directors
All eleven of the directors nominated by the Company’s Board of Directors to serve as directors of the Company were elected by the Company’s shareholders, each to serve for a term which expires at our 2027 annual meeting of shareholders, and each to hold office until his or her successor is elected and qualified or until the director’s earlier death, resignation, retirement, disqualification or removal, by the votes set forth below.
Annual-meeting results Form 8-K, filed 2026-05-01; actual election of eleven directors for terms expiring in 2027 · Filed 01/05/2026
