ALEX VEIGA

LOS ANGELES (AP) â¿¿ Homebuilder PulteGroup Inc. reports fourth-quarter results before the stock market opens on Friday.

WHAT TO WATCH FOR: How new home orders fared in October through December, when the pace of new home sales improved from the lowest level in decades during the summer. Also, any word on whether demand is improving in advance of the spring home-selling season.

Homebuilders are coming off the worst year for new home orders since at least 1963. New home sales plunged 14 percent last year versus 2009, which was the second-worst year on record.

High unemployment, tight credit and uncertainty about home prices are keeping many would-be buyers on the sidelines despite mortgage rates remaining at near-historic lows.

Sales improved in October to November and again in December, but not enough to lift results for several major builders.

In recent weeks, KB Home, Lennar Corp., D.R. Horton Inc., and Standard Pacific Corp. all reported sharp drops in home deliveries and contracts for new homes in either the September-November quarter or the October-December period.

Meritage Homes Corp., bucked that trend, reporting this week a 15 percent jump in new home orders. Still, its home deliveries sank 30 percent.

It doesn't help that builders are up against strong sales a year earlier, when federal tax credits were in effect. Those incentives ended last April.

Like its rivals, PulteGroup is not expected to post increases in contracts for new homes or in completed sales in the fourth quarter.

Ticonderoga Securities analyst Stephen East anticipates that PulteGroup's new home orders will tumble 23 percent and its closings will drop 34 percent.

In the third quarter, the builder's new home orders slid 12 percent.

While builders such as KB Home and Lennar have posted quarterly profits of late, PulteGroup is expected to post a quarterly loss on hefty charges.

Management has said it would book a restructuring charge in the fourth quarter. East anticipates the builder also will record impairment charges in excess of $50 million.

WHY IT MATTERS: Homebuilders are a bellwether for the housing market and the economy. Each new home built creates, on average, the equivalent of three jobs for a year and generates about $90,000 in taxes paid to local and federal authorities, by some estimates.

PulteGroup, which is based in Bloomfield Hills, Mich., operates in 29 states and the District of Columbia. Its Del Webb brand is the nation's largest builder of communities for adults age 55 and over.

WHAT'S EXPECTED: Analysts polled by FactSet expect PulteGroup will report a loss of 9 cents a share on $1.13 billion in revenue.

East predicts a loss, excluding impairment charges, of a penny a share.

LAST YEAR'S QUARTER: PulteGroup reported a loss of $116.9 million, or 31 cents a share, on revenue of $1.73 billion. Those results included $925 million in charges related to write-downs on land and its acquisition of Dallas-based Centex and a one-time tax benefit of $800 million. Excluding the charges and tax gain, the company just about broke even for the period.

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