PulteGroup (NYSE:PHM) and Sekisui House (OTCMKTS:SKHSY) Financial Comparison

PulteGroup (NYSE:PHM) and Sekisui House (OTCMKTS:SKHSY) are both large-cap construction companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, risk, analyst recommendations, earnings, valuation, profitability and institutional ownership.

Institutional and Insider Ownership

89.9% of PulteGroup shares are held by institutional investors. Comparatively, 0.0% of Sekisui House shares are held by institutional investors. 0.8% of PulteGroup shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Volatility & Risk

PulteGroup has a beta of 1.27, indicating that its stock price is 27% more volatile than the S&P 500. Comparatively, Sekisui House has a beta of 0.55, indicating that its stock price is 45% less volatile than the S&P 500.

Dividends

PulteGroup pays an annual dividend of $0.88 per share and has a dividend yield of 0.6%. Sekisui House pays an annual dividend of $0.88 per share and has a dividend yield of 3.8%. PulteGroup pays out 6.6% of its earnings in the form of a dividend. Sekisui House pays out 43.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. PulteGroup has raised its dividend for 7 consecutive years.

Profitability

This table compares PulteGroup and Sekisui House’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PulteGroup	15.50%	21.01%	14.73%
Sekisui House	4.67%	10.16%	4.19%

Analyst Ratings

This is a breakdown of current ratings and price targets for PulteGroup and Sekisui House, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PulteGroup	0	5	9	1	2.73
Sekisui House	0	1	0	0	2.00

PulteGroup currently has a consensus target price of $136.46, indicating a potential upside of 0.72%. Given PulteGroup’s stronger consensus rating and higher probable upside, research analysts plainly believe PulteGroup is more favorable than Sekisui House.

Valuation & Earnings

This table compares PulteGroup and Sekisui House”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PulteGroup	$17.95 billion	1.49	$3.08 billion	$13.38	10.13
Sekisui House	$26.67 billion	0.58	$1.44 billion	$2.04	11.43

PulteGroup has higher earnings, but lower revenue than Sekisui House. PulteGroup is trading at a lower price-to-earnings ratio than Sekisui House, indicating that it is currently the more affordable of the two stocks.

Summary

PulteGroup beats Sekisui House on 15 of the 18 factors compared between the two stocks.

About PulteGroup

PulteGroup, Inc., through its subsidiaries, primarily engages in the homebuilding business in the United States. It acquires and develops land primarily for residential purposes; and constructs housing on such land. The company also offers various home designs, including single-family detached, townhomes, condominiums, and duplexes under the Centex, Pulte Homes, Del Webb, DiVosta Homes, John Wieland Homes and Neighborhoods, and American West brand names. In addition, the company arranges financing through the origination of mortgage loans primarily for homebuyers; sells the servicing rights for the originated loans; and provides title insurance policies, and examination and closing services to homebuyers. PulteGroup, Inc. was founded in 1950 and is headquartered in Atlanta, Georgia.

About Sekisui House

Sekisui House, Ltd. designs, constructs, and contracts built-to-order detached houses in Japan and internationally. The company operates through Custom Detached Houses, Rental Housing, Architectural/Civil Engineering, Remodeling, Real Estate Management Fees, Houses For Sale, Condominiums, Urban Redevelopment, and Overseas segments. It also engages in contracting of design and construction of custom detached houses, rental housing, office building, commercial buildings, and other properties; construction of reinforced concrete rental housing and commercial buildings; contracting of design and construction of civil engineering works; remodeling and renovation of houses; subleasing, management, operation, and brokerage of real estate; sale of houses and residential land; and sales of condominiums. Sekisui House, Ltd. was incorporated in 1929 and is headquartered in Osaka, Japan.