(This is The Best Stocks in the Market , brought to you by Josh Brown and Sean Russo of Ritholtz Wealth Management.) Josh — Here’s the set-up. So-called “old economy” stocks are all the rage as investors search for areas with growth that are not susceptible to AI-related disruption. We talked about this at length on Monday and I won’t repeat it all. Suffice it to say, homebuilders are not replicable via LLM. Pulte Homes is the best chart in the space right now. The stock is taking out its high as I type so I’ll keep the preamble short. Sean’s going to tell you the story, I’ll be back with some risk management after… Best Stock Spotlight: PulteGroup, Inc. (PHM) Sean — For those who joined us at the CNBC Live event in January, Josh and I stressed that the market is usually right. The wisdom of crowds is a strong signal that something meaningful is happening beneath the surface. Put differently, price tends to lead fundamentals. Hundreds of thousands of professionals (and algorithms), along with millions of traders are constantly digesting and pricing in new information in real time. And since earnings reports only come out once a quarter, they are by definition a lagging indicator. This year, price is telling a very different story than it has in recent years. Not only is the technology sector lagging the S & P 500, it’s underperforming eight other sectors as well. So where are the winners? The State Street S & P Homebuilder ETF (XHB) just cleared its September 2025 high, reaching levels not seen since December 2024. The sub-sector is home to four S & P Residential Construction constituents: D.R. Horton (DHI), Lennar (LEN), NVR (NVR), and PulteGroup (PHM), but only one has earned a spot on our list. PulteGroup (PHM): PulteGroup (PHM) is one of the largest homebuilders in the United States, constructing homes across a range of price points under its Pulte Homes, Del Webb, and Centex brands. PHM’s price peaked in October of 2024, a full 52 trading days before revenue topped out. The stock then sold off through Liberation Day and has been sideways since the fall of 2025. Now, with price pushing back toward highs, the question is: what is the market telling us about what’s ahead for PulteGroup’s fundamentals? Well, their management noted in January that they are anticipating improved affordability relative to the past few years due to mortgage rates nearly 1% lower than last year and 4% year-over-year wage growth for their core population of buyers. The U.S. remains underbuilt by an estimated 3–4 million homes, and demographics across first-time and move-up buyers play to PHM’s strength. That strength is showing up in its stock price. Risk management Josh — As you can see in the chart above, we’re approaching the highs of last August. RSI in the mid 60’s is still relatively tame but confirming the rally. And look at those two recent tests of the 200-day – the stock barely kissed it and the buyers were all over the stock. As you’ll see in the chart below, there’s more to the story. This is a monster multi-year cup and handle formation, one of the most bullish patterns of buying and selling in the books. You’re looking at weekly closes and the 50-week moving average above. This breakout above $140 should take the stock up to $150. If that breaks, look out. Your offramp here is still the 200-day at $119. A drop below $120 on a closing weekly basis (Friday closes) tells you the risk-reward has fallen apart and the stock would need to set back up again. DISCLOSURES: (None) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, or its parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. INVESTING INVOLVES RISK. EXAMPLES OF ANALYSIS CONTAINED IN THIS ARTICLE ARE ONLY EXAMPLES. THE VIEWS AND OPINIONS EXPRESSED ARE THOSE OF THE CONTRIBUTORS AND DO NOT NECESSARILY REFLECT THE OFFICIAL POLICY OR POSITION OF RITHOLTZ WEALTH MANAGEMENT, LLC. JOSH BROWN IS THE CEO OF RITHOLTZ WEALTH MANAGEMENT AND MAY MAINTAIN A SECURITY POSITION IN THE SECURITIES DISCUSSED. ASSUMPTIONS MADE WITHIN THE ANALYSIS ARE NOT REFLECTIVE OF THE POSITION OF RITHOLTZ WEALTH MANAGEMENT, LLC” TO THE END OF OUR DISCLOSURE. Click here for the full disclaimer.
