Tags: Lennar | Earnings | home | houses

Lennar Earnings More Than Quadruple on Demand for New Houses

Monday, 24 Sep 2012 08:09 AM

Lennar Corp., the third-largest U.S. homebuilder, reported a quarterly profit that beat market expectations and said orders rose for the sixth straight quarter.

The company's revenue for the third quarter was the highest in nearly four years, pointing to a stabilizing recovery in the housing market.

"Low mortgage rates, affordable home prices (and) increased buyer confidence ... are driving growth in each of our markets," Lennar Chief Executive Stuart Miller said in a statement.

Miami-based Lennar, which mainly operates in eastern United States, recorded higher deliveries, orders and backlog across all its operating regions.

Net orders rose 44 percent to 4,198 homes, worth $1.15 billion, in the quarter ended August. Orders are a key indicator for builders, who do not book revenue until they close on a house.

Rival KB Home reported strong results last week, also underlining growing momentum in housing recovery.

Builders have been able to charge higher prices as buyers take advantage of low interest rates. Mortgage rates touched record lows last week after the Federal Reserve said it would try to bolster the economy by buying housing-related debt.

Average selling prices rose 4 percent to $258,000 in the third quarter, Lennar said.

Gross margins on home sales rose to 23.2 percent from 21.1 percent as the company delivered more houses to higher-margin communities. Total deliveries rose 28 percent.

Net income attributable to the company rose to $87.1 million, or 40 cents per share, from $20.7 million, or 11 cents per share, a year earlier.

Revenue from home sales rose 33 percent. Total revenue jumped 34 percent to $1.10 billion.

Analysts on average expected earnings of 28 cents per share, excluding items, on revenue of $1.05 billion, according to Thomson Reuters I/B/E/S.

Lennar shares, which have almost doubled in value this year, closed at $37.51 on the New York Stock Exchange on Friday. The shares fell 1.5% to end at $36.96 Monday.

The broader S&P 1500 Homebuilding Sub-Industry Index has almost tripled since touching a year low in October.

© 2017 Thomson/Reuters. All rights reserved.

   
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Lennar Corp., the third-largest U.S. homebuilder, reported a quarterly profit that beat market expectations and said orders rose for the sixth straight quarter, driving up its stock 6 percent in premarket trading. The company's revenue for the third quarter was the highest...
Lennar,Earnings,home,houses
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2012-09-24
Monday, 24 Sep 2012 08:09 AM
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