Housing

Home Builder Lennar Posts Another Profit

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Lennar Corp. (NYSE: LEN) reported fiscal first-quarter results before markets opened this morning. The home builder reported quarterly diluted earnings per share (EPS) of $0.26 on revenues of $989.9 million. In the same period a year ago, Lennar reported EPS of $0.08 on revenue of $724.9 million. This morning’s results also compare to the consensus estimates for EPS of $0.15 and $898 million in revenue.

The company improved its results on virtually every metric: deliveries were up 28% year-over-year for the quarter, new orders rose 34%, backlog is up 82%, gross margin rose 1.2% and operating margin rose 4.1%.

The company’s CEO said:

Our first quarter results clearly reflect continued improvement in the marketplace. Current market conditions are driven by strong demand resulting from low interest rates and attractive home prices, which have led to very affordable monthly payments, compared to increasing rental rates. Supply continues to be limited by low home inventories and fewer competing homebuilders. Accordingly, pricing trends have been positive, as shown by a 13% increase in the average sales price of homes in our backlog at quarter-end, compared to last year.

The company offered no guidance, but reported that its backlog of new homes at the end of the first quarter totaled 4,922, with a dollar value of the backlog at $1.5 billion, more than double in the same period a year ago. The consensus estimates for the second quarter call for EPS of $0.35 on revenues of $1.27 billion.

Shares are up 1.2% in premarket trading, at $41.91 in a 52-week range of $23.48 to $43.22. Thomson Reuters had a consensus analyst price target of around $40.60 before today’s results were announced.

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