Lennar - Another Homebuilder To Warn About The Housing Recovery In 2015The Value Investor • Wed, Jan. 21
- Lennar posts solid results for the fourth quarter of 2014.
- These results were aided by higher purchase incentives, as the company warns for its gross margins in 2015 after competitor KB Home did the same thing.
- Following aggressive inventory lots built up, the company has essentially used its balance sheet to bet on the housing recovery.
- Given the leverage employed and dire consequences of a housing downturn, I continue to shun investing in the housing sector and Lennar.
Lennar Homes' Q4 Earnings Beat Is Sending Its Shares Higher - Should You Be A Buyer?Joey Solitro • Thu, Jan. 15
- Q4 2014 earnings were released on the morning of January 15.
- Earnings per share and revenue beat expectations.
- New home orders increased 22.1% to 5,492, with a total dollar value of $1.8 billion.
- The stock has responded by rising over 1%.
Toll Earnings Redux/Lennar Earnings Preview: Hombuilders Starting To Find A BidBrian Gilmartin, CFA • Mon, Jan. 12
- After TOL's earnings on 12.10.14, homebuilder is finally free-cash-flow positive.
- Lennar is best-in-class within mid-price homebuilders.
- Crude oil price drop will have analysts asking about Texas and Southwest impact on housing starts.
- LEN could be more impacted than TOL from crude price decline, given price point.
- Lennar shares have dropped in the past month due to weakness in housing starts.
- A large number of investors are betting against Lennar as its high short ratio suggests.
- Lennar, however, should get better in the long run on the back of housing market improvements, better pricing, and stronger orders.
- The company's earnings growth is expected to outpace the industry average.
- Lennar's focus on first-time home buyers is a smart move as this will allow the company to benefit from an improving economic scenario.
- Lennar is upgrading its housing portfolio and throwing in incentives to attract more buyers.
- Lennar is attractively valued and is expected to deliver impressive earnings growth in the next five years.
- Lennar Corp. has just printed a very important and telling 7-year high.
- This milestone represents a resumption of momentum building on top of continued strong financial performance from Lennar Corp.
- Further upside may be sustained by improvements in analyst and market sentiment.
Lennar: Sound Strategies And Improving Homebuilding Confidence Indicate Better Times Ahead
- Lennar is focused on improving profitability by taking advantage of economies of scale.
- Lennar should witness strong demand in the market, as a strong order backlog shows.
- Lennar's robust product pipeline is a catalyst that investors should not ignore.
- Improving homebuilder and consumer confidence indicates better times ahead for Lennar.
Lennar - Strong Operational Momentum, Strong Guidance, But No Strong Appeal
- Lennar posts stronger-than-anticipated sales and earnings.
- Investors like the results, with management being upbeat about the prospects for the business.
- I am more cautious amidst the cyclical nature of the business, the higher leverage and already high valuation.
- Lennar beat analyst expectations on EPS and on revenue in its Q3 report.
- This positive quarter has cemented my bullish long-term conviction in Lennar.
- In my previous article, I opined that the multifamily segment becoming accretive would allow Lennar to exceed analyst estimates.
- The whisper number is $0.66, one cent behind the analysts' estimate.
- Lennar has a 70% positive surprise history (having topped the whisper in 26 of the 37 earnings reports for which we have data).
- The overall average price move is 'as expected' (beat the whisper number and see strength, miss and see weakness) when the company reports earnings.
Lennar Earnings Preview: The Quandary Is Decent Growth, Attractive Valuation, But Slowing Orders
- LEN average estimated EPS and revenue growth for next 3 years is 20% and 19% respectively.
- LEN is more a mid-range homebuilder vs TOL at the high end.
- Order growth has been slowing for homebuilders.
KB Home Crushed Earnings, Will Lennar Corp. Follow Suit?
Lennar Earnings Preview: Fundamentals Looks Great, Technicals Are Worrisome
- Lennar remains best-in-breed in mid-range new home construction.
- Forward growth estimates are expecting robust revenue and EPS growth.
- The technicals of Lennar and homebuilders look somewhat ominous.
Lennar: A Safe Investment In A Risky Housing MarketMihir Mehta • Dec. 26, 2013
What Hedge Funds Are Saying About Lennar CorporationLeigh Drogen • Dec. 17, 2013
Yesterday, 10:49 AM
- D.R. Horton (DHI +7.4%) earlier reported FQ1 (ending Dec. 31) results which beat estimates and also said the sales pace has picked up in January.
- On the earnings call, management guides for 2015 gross margins of roughly 20% - earlier this month, both Lennar and KB Home warned on margins in 2015.
- ITB +1.7%, XHB +1.3%
- Lennar (LEN +2.7%), KB Home (KBH +1.7%), Toll Brothers (TOL +1.4%), Hovnanian (HOV +2.2%), PulteGroup (PHM +1.9%), Ryland (RYL +1.5%)
Thu, Jan. 15, 11:31 AM
- The company earlier reported bottom-line results which beat estimates, but the top line slightly missed.
- FQ4 (ending Nov. 30) deliveries of 6,950 homes gained 23% from a year ago. New orders of 5,492 homes up 22%, up 24% in dollar terms. ASP of $329K vs. $307K a year ago. Incentives of 23.1K per home, or 6.6% of home sales revenue vs. $20.6K and 6.3% a year ago.
- Backlogs of 5,832 homes up 21%, up 22% in dollar terms.
- Gross margins of 25.6% fell 120 basis points from a year ago. Operating margin of 16% down 90 bps.
- Like KB Home earlier this week, Lennar (LEN -4%) warns of lower gross margins for fiscal 2015.
- ITB -2.9%, XHB -2.2%
- Toll Brothers (TOL -2.7%), Hovnanian (HOV -5.3%), D.R. Horton (DHI -4.9%), Ryland (RYL -4.7%), KB Home (KBH -5.5%), Pulte (PHM -4.3%) M.D.C. Holdings (MDC -5.9%), NVR (NVR -2.5%), Standard Pacific (SPF -3.2%)
- Previously: Lennar beats by $0.11, misses on revenue (Jan. 15)
Thu, Jan. 15, 6:17 AM
Wed, Jan. 14, 7:42 PM
Wed, Jan. 14, 5:30 PM
Wed, Jan. 7, 11:04 AM
- Bloomberg is reporting the president as set to announce a 50 basis point reduction in FHA fees to 0.85% at an event in Phoenix tomorrow. The news isn't good for private mortgage insurers who have been happily raking in market share gains at the expense of the government agency, but the homebuilders are a different story.
- Previously: Mortgage insurers tumble on report of cut in FHA premiums (Jan. 7)
- ETFs: ITB +3%, XHB +2.5%
- Toll Brothers (TOL +2.7%), Lennar (LEN +3.8%), D.R. Horton (DHI +4%), Ryland (RYL +2.9%), KB Home (KBH +2.5%), Hovnanian (HOV +3.6%), PulteGroup (PHM +3.9%).
Dec. 31, 2014, 3:18 PM
- "We maintain our long-term view that companies with attractive geographic exposures should be outperformers combined with strong capital allocation and timing of land purchases," says analyst Eli Hackel, reiterating Lennar (LEN +1.6%) as a Conviction Buy, while also noting the recent strong momentum for KB Home (NYSE:KBH), Meritage (NYSE:MTH), and Taylor Morrison (NYSE:TMHC).
- While recent housing industry data has turned softer, long-term trends are intact, says Hackel, who - so far - sees little sign lower oil prices are impacting housing in Houston.
Dec. 11, 2014, 8:41 AM
Dec. 10, 2014, 3:53 PM
- "Why 2014 was a pause and flat to 2013 and not improving has been a bit puzzling," says Toll Brothers (TOL -7.6%) management on the earnings call.
- Asked about the impact of tumbling energy prices on markets like Dallas and Houston, management says the company's exposure there is small, with Houston accounting for 3.7% of signed contracts.
- Overall, Toll expects the housing recovery to be "bumpy," and that demand will truly return when buyers no longer fear price drops.
- Previously: Toll Brothers slips on FQ4 miss (Dec. 10, 2014)
- It's a different story (at least for the stock price) with Hovanian (HOV +5.9%) after its earning report today. Management: "It's an understatement to say that the past 12 months have been choppy ... Given the gains we've seen in employment, we would have expected stronger home sales."
- Previously: Hovnanian pops as fiscal 2015 starts off strong (Dec. 10, 2014)
- Other builders today: Ryland (RYL -5.1%), Lennar (LEN -5.3%), Beazer (BZH -5.1%), Pulte (PHM -3.5%), KB Home (KBH -5.1%).
- ETFs: ITB -3.4%, XHB -2.5%
Nov. 17, 2014, 9:34 AM
- The currently-dormant former home of the 49ers and Giants, the "Stick" will be turned into a 500K square-foot "urban outlet" shopping center, courtesy of the current owner of the land, Lennar (NYSE:LEN), and its mall-owner/developer partner, Macerich (NYSE:MAC).
- The project will also include more than 6K homes - both rentals and for-sale.
- Demolition of Candlestick is slated for this winter. New investment and infrastructure over the next few years will top $1B.
- Source: Press release
Nov. 10, 2014, 10:08 AM
- Releasing preliminary FQ4 results ahead of a conference presentation, Toll Brothers reported sizable year-over-year sales gains both in terms of units and dollars. The ASP of homes delivered of $747K was up 6.3% from a year ago. The ASP of signed contracts in FQ4 of $757K was up 5%.
- PulteGroup (PHM +2.6%) is also benefitting from an upgrade to Buy at BofA. Others: Lennar (LEN +2.7%), D.R. Horton (DHI +2.1%), Ryland (RYL +3.1%), Hovnanian (HOV +3.4%), KB Home (KBH +3.1%).
- ETFs: ITB, XHB
Oct. 2, 2014, 4:42 PM
Sep. 17, 2014, 7:14 AM
- Q3 net earnings of $177.8M or $0.78 per share vs. net earnings of $120.7M and $0.54 one year ago.
- Deliveries of 5,457 homes up 9% Y/Y. New orders of 5,889 up 23%; new order dollar value of $1.9B up 28%.
- Backlog of 7,290 homes up 22%; backlog dollar value of $2.5B up 29%.
- Gross margin on home sales of 25.2% up 30 basis points.
- Operating margin on home sales of 14.8% up 10 basis points.
- Lennar Multifamily contributed operating earnings of $8.5M compared to a start-up operating loss of $5.6M. The unit completed its first two sales of apartment properties in Q3, with both producing greater than the targeted 25% ROIC.
- CEO Stuart Miller: "Our core homebuilding business is hitting on all cylinders as we have properly considered and understood the uniqueness of this recovery."
- Conference call at 11 ET
- Previously: Lennar beats by $0.11, beats on revenue
- LEN +4.3% premarket
Sep. 17, 2014, 6:04 AM
Sep. 16, 2014, 5:30 PM
Sep. 9, 2014, 7:39 AM
- Lennar (NYSE:LEN) and D.R. Horton (NYSE:DHI) are upgraded to Overweight, while PulteGroup (NYSE:PHM) is upgraded to Neutral following a near-9% drop YTD.
- Downgrades from Overweight to Neutral: M/I Homes (NYSE:MHO), Meritage Homes (NYSE:MTH). Downgrades from Neutral to Underweight: M.D.C. Holdings (NYSE:MDC) and Standard Pacific (NYSE:SPF).
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