The Other Lennar: Lennar B Offers 10X The Voting Rights At 25% Off
Special Situations and Arbs • 39 Comments
Special Situations and Arbs • 39 Comments
Sep. 20, 2015, 5:30 PM
Sep. 17, 2015, 3:49 PM
- Outperforming alongside the big dividend payers are the homebuilders after the FOMC refrained from hiking rates today, but still all but promises tighter policy before the year is out. The big gains in homebuilders are in contrast to the S&P 500 which is flat.
- The inaction has sparked a major rally in bonds across the curve, with the 10-year yield lower by ten basis points to 2.20% and the two-year yield down a full twelve basis points to 0.68%.
- Earlier today, August housing starts disappointed, and July starts were revised sharply lower.
- Previously: August housing starts disappoint; July revised sharply lower (Sept. 17)
- Toll Brothers (TOL +1.2%), Lennar (LEN +1.5%), Hovnanian (HOV +6%), PulteGroup (PHM +1.1%), Ryland (RYL +2.1%), D.R. Horton (DHI +2%), KB Home (KBH +2%)
- ETFs: ITB, XHB
Sep. 15, 2015, 1:28 PM
- Despite worries about a wash of apartment construction over the past five years, a high occupancy rate has builders Lennar (NYSE:LEN) and Toll Brothers (NYSE:TOL) doubling down in the market.
- Toll plans to literally double its apartment-development division and expand its from the northeast corridor across the country. In Lennar's case, it's built a $1.1B war chest for construction in 25 markets and wants to expand it to $2B within a year.
- The long-term annual average in apartment building is 120,000/year; meanwhile, developers in 79 markets built 173K units last year, and are expected to build 220K this year and 190K next year.
- Vacancy rates, though, have been at 15-year lows (about 4.2%) while rents have steadily risen to 15-year highs ($1,194/month in 79 markets). And the percentage of people "doubled up" (living with a non-spouse adult) rose to 48% this year from 44% in 2007, suggesting many will seek their own rental.
- Lennar and Toll reps say they're being conservative, and the market isn't peaking yet.
Aug. 28, 2015, 11:10 AM
- There's plenty of precedent for the recent market action, says Morgan Stanley's Adam Parker, noting the market has dropped more than 5% 16 times since March 2009, and each time has moved on to new highs.
- His half-glass view is that the economy is in the middle of its longest expansion ever, and a less-active Fed, a nervous consumer maybe saving more, a lower oil price, and a flattish dollar all argue for continued expansion.
- Morgan's top ideas to buy on the pullback: AGN, AMZN, AAPL, AVGO, BAC, BKU, DAL, GILD, GOOG, GOOGL, HLT, JPM, KR, LEN, LMCK, MGA, MBLY, NWL, QCOM, SABR, CRM, SBAC, SBUX, BX, TMO, VRSK, WWAV, XL.
Aug. 17, 2015, 4:33 PM
- Major stock indexes rebounded from opening declines to finish modestly higher, after a solid housing report showed some strength on a lightly traded Monday.
- Homebuilding stocks paced gainers, including Toll Brothers (TOL +2.3%); Ryland (RYL +2.1%); KB Home (KBH +3.1%), Lennar (LEN +2.7%) and Taylor Morrison Home (TMHC +2.9%).
- The S&P 500 gained 0.5% to 2,102.44; for 2015, it's up 2.12%. The move up came despite a grim reading from New York manufacturing that sent bond yields lower. TLT +0.5%; TBT -0.8%.
- Volumes overall were about 20% below recent average.
- Sector gains were broadly distributed, with a flat energy sector as the laggard. Healthcare stocks performed well, paced by dollar volume leaders Gilead Sciences (GILD +0.7%), Johnson & Johnson (JNJ +1.1%) and Biogen (NASDAQ:BIIB) +1.1%.
Jul. 22, 2015, 10:36 AM
- In the latest data point signaling the housing recovery has shifted into another gear, the NAR earlier reported a 3.2% gain in the seasonally adjusted annualized rate of existing home sales to 5.49M in June.
- Sales are at their highest pace since February 2007 and are 9.6% above the pace of one year ago.
- The median price of $236.4K is up 6.5% Y/Y and surpasses the peak set in July 2006.
- ETFs: ITB +1.5%, XHB +1.5%
- Toll Brothers (TOL +2%), Lennar (LEN +1.7%), KB Home (KBH +1.9%), Pulte (PHM +2.1%), D.R. Horton (DHI +2.1%), Hovnanian (HOV +0.9%), Ryland (RYL +3.1%)
- Previously: Existing home sales rise to fastest pace in eight years (July 22)
Jun. 24, 2015, 9:13 AM
Jun. 24, 2015, 7:52 AM
- FQ2 new home deliveries excluding unconsolidated entities of 5,989 homes up 20% Y/Y. ASP of $348K up 8%. Sales incentives of $21.5K is 5.8% of sales revenue versus $20.3K and 5.9% a year ago..
- Gross margins on home sales of 23.8% versus 25.5% a year ago, with an increase in land costs more than offsetting higher sales prices. Operating margin on home sales of 13.8%. Both reads are better than company guidance.
- New orders of 7,271 homes up 18% Y/Y; $2.6B in dollar terms up 28%.
- Backlog of 8.073 homes up 18%; $2.9B in dollar terms up 23%.
- Conference call at 11 ET
- Previously: Lennar beats by $0.15, beats on revenue (June 24)
- LEN +4.7% premarket
Jun. 24, 2015, 6:03 AM
- Lennar (NYSE:LEN): FQ2 EPS of $0.79 beats by $0.15.
- Revenue of $2.39B (+31.3% Y/Y) beats by $370M.
Jun. 23, 2015, 5:30 PM
Jun. 23, 2015, 4:33 PM
- Lennar (NYSE:LEN) declares $0.04/share quarterly dividend, in line with previous.
- Forward yield 0.32%
- Payable July 22; for shareholders of record July 8; ex-div July 6.
Jun. 19, 2015, 10:09 AM
- KB Home CEO Jeffrey Mezger is confident of his company's ability to achieve "measurable year-over-year earnings growth in H2" after reporting new order growth of 33% in units and 38% in dollars in FQ2, and backlog growth of 39% in units and 57% in dollars.
- KB Home is up 6%, leading the ITB +1.4%, and XHB +0.8% even as the major averages slip.
- Toll Brothers (TOL +2.3%), Hovnanian (HOV +2.7%), Lennar (LEN +3%), Ryland (RYL +2%), D.R. Horton (DRI +2.5%), Pulte (PHM +2.5%)
- Previously: KB Home gains following earnings beat (June 19)
- Previously: KB Home beats by $0.02, beats on revenue (June 19)
Jun. 15, 2015, 9:44 AM
- Zigging higher while the rest of the market zags sharply lower are the homebuilders following this weekend's merger of Ryland Homes and Standard Pacific.
- While there have been a number of smaller deals over the past year, this one is more sizable, setting off hope of a broader - and necessary, according to some - consolidation in the fragmented sector.
- Lennar (LEN +1.9%), Toll Brothers (TOL +1.4%), M.D.C. Holdings (MDC +2.3%), M/I Homes (MHO -0.5%), NVR (NVR), D.R. Horton (DHI +1.5%), KB Home (KBH +0.7%), Beazer Homes (BZH +1.2%), PulteGroup (PHM +1.6%), Hovnanian (HOV flat)
- Previously: Industry eyes Ryland/Standard Pacific merger (June 15)
Jun. 9, 2015, 10:14 AM
- The usually sunny Ara Hovnanian found himself unable to put lipstick on his company's pig of a quarter and the stock is lower by 14.4% in early action (the conference call begins at 11 ET).
- Topping off the poor results, interest rates are back on the rise, with the 10-year Treasury yield hitting a new high for the year at 2.44%.
- The other homebuilders are acting as if HOV's issues are company-specific: Toll Brothers (TOL -0.2%), Lennar (LEN -0.2%), PulteGroup (PHM -0.6%), D.R. Horton (DHI -0.2%), KB Home (KBH -0.8%), Ryland (RYL -0.6%), Standard Pacific (SPF flat).
- ETFs: ITB -0.2%, XHB -0.3%
May 27, 2015, 10:43 AM
- Toll Brothers (TOL -2.8%) managed to beat on the bottom line thanks to lower income taxes, but revenues actually fell from a year ago, while SG&A expense as a percent of revenue climbed 50 bps to 12.6%.
- Hovnanian (HOV -0.8%), Lennar (LEN -0.9%), Ryland (RYL -0.7%), Beazer (BZH -1%), Pulte (PHM -1.1%), D.R. Horton (DHI -1.1%)
- ETFs: ITB, XHB
- Previously: Toll Brothers reports mixed FQ2; early Q3 returns mixed as well (May 27)
- Previously: Toll Brothers beats by $0.02, misses on revenue (May 27)
May 19, 2015, 9:06 AM
- April housing starts at a seasonally adjusted annualized rate of 1.14M were up 20% from March, and the strongest pace since the housing collapse began to pick up pace about eight years ago.
- Lennar (NYSE:LEN) +0.85%, PulteGroup (NYSE:PHM) +1.15%, KB Home (NYSE:KBH) +1.75%, Ryland (NYSE:RYL) +0.2%, D.R. Horton (NYSE:DHI) +1.4%, Hovnanian (NYSE:HOV) +1.9% premarket.
- ETFs: ITB, XHB
- Previously: Housing starts jump in April (May 19)
Lennar Corp. provides real estate related financial services, a commercial real estate investment, investment management and finance company through its Rialto segment and a developer of multifamily rental properties in select U.S. markets primarily through unconsolidated entities. The company... More
Sector: Industrial Goods
Industry: Residential Construction
Country: United States
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