PulteGroup posted its best week in months, rallying 6.1% to close at $117.84 — yet short sellers have used the strength to add, not cover, a dynamic that defines the tension heading into July earnings.
The previous note flagged bears quietly rebuilding positions into a declining tape. That rebuild has continued, even as the stock reversed sharply higher. Short interest now runs at 3.96% of the free float, up 5.8% on the week and 8.6% over the past month — the highest level since late April. Crucially, the cost to borrow has actually eased back, dropping 15% on the week to 0.47% APR, after the spike to 0.56% flagged last time. Cheap borrow means it costs almost nothing to hold a short position, and the lending pool is anything but tight. Availability has expanded dramatically — now at over 4,600% of short interest, up from roughly 3,700% a week ago — meaning there is no mechanical pressure on existing shorts and ample room for new ones. The borrow market is wide open.
Options positioning has shifted. The put/call ratio has eased to 1.17, down from the 1.38–1.50 readings that dominated mid-May when the stock was falling hard. That said, the PCR remains above its 20-day average of 1.13, and the ratio peaked at 1.50 on May 15 — the 52-week high — just before the stock's reversal. The hedging overhang from that peak has partly unwound, but options positioning still leans defensive relative to the broader history of the past year.
The Street remains in the bulls' camp, though with some nuance. Following Q1 results on April 23, most firms that moved their targets went higher — Evercore ISI, UBS, and Wells Fargo all raised targets in the $140–$162 range while maintaining positive ratings. BofA cut its target modestly to $140 but kept Buy. The one outlier was Seaport Global, which swung to Sell with a $100 target. All of this analyst activity predates the current note by roughly a month, placing these as post-earnings adjustments rather than fresh views. The consensus remains Buy, and at a trailing P/E of 11.2 and EV/EBITDA of 8.1, the stock is priced modestly — the bull case centres on active adult segment normalization lifting gross margins back toward historical levels in FY26. Bears counter with forecasted order declines of -9% year-over-year in H2, weakening demand, and affordability pressure in key markets including the West and Texas.
The peer move this week is worth noting. TOL led the sector with a gain of 8.6%. KBH added 7.8% and LEN rose 6.5%. PHM's 6.1% gain was broadly in line with peers DHI and MTH, which gained 5.9% and 5.8% respectively. This week's rally looks like a sector-wide move rather than a PHM-specific catalyst — which makes the continued short-building more pointed. Shorts are not treating the bounce as a reason to exit.
The prior earnings reaction provides context without clarity: the April 23 Q1 print landed flat on the day but fell 4.1% over the following five sessions. The next event is July 22. Between now and then, the key read is whether short interest continues to climb through a rising tape — if it does, the setup into Q2 earnings will be more charged than positioning alone would suggest.
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