Oppenheimer analysts raised their price target on PulteGroup, Inc. (NYSE:PHM) to $73 from $68 and reiterated their Outperform rating, expecting multiple expansions given a positive backdrop for builders broadly and because the company likely will have the highest ROE in the space this year.

According to analysts, they believe that the premium can be maintained in 2023 due to various factors such as Pulte's projected gross margin, backlog ASP, market mix, and exposure to a diverse range of buyers. Furthermore, the analysts anticipate that the estimated earnings per share (EPS) for 2023 could increase, as it is currently 35% lower compared to the same time last year.

The analysts highlighted $0.38 of incremental upside to their $7.85 estimate (vs. the Street’s $7.50) based on higher closing ASP and margin.