What: Shares of homebuilder PulteGroup
So what: Wells' report showed an increase in orders for the third straight month, suggesting that U.S. housing should continue to recover going forward. Pricing in each of the 20 markets also improved, giving housing bulls -- Lennar, D. R. Horton, and Toll Brothers are also up nicely today -- plenty to be excited about.
Now what: I'd be cautious about riding this recent wave of optimism. Pulte is now up more than 150% from its October lows and currently trades at a price-to-book of 1.5, so much of those housing recovery hopes might already be baked into the price. Given the mix of housing, economic, and jobs data in recent weeks, going "all in" at these levels seems particularly risky.
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