Lennar Q4 Earnings And Revenues Beat, Shares Rise

Lennar Corporation’s (LEN - Free Report) shares gained 3.2% after the company reported better-than-expected results in fourth-quarter fiscal 2019 (ended Nov 30, 2019). This marks the third consecutive quarter of earnings beat. The results mainly benefited from solid demand for new homes, depicting healthy housing market fundamentals stemming from low unemployment, higher wages and a decline in inventory levels.

The company reported quarterly earnings of $2.13 per share, surpassing the Zacks Consensus Estimate of $1.90 by 12.1%. Also, the reported figure jumped 15.8% from $1.84 reported in the year-ago quarter (excluding a one-time gain of 58 cents per share from the sale of Rialto and non-recurring expenses). The upside was mainly driven by higher deliveries and continued operating leverage, backed by technological efforts.

Revenues of $6.97 billion topped the consensus estimate of $6.7 billion by 4.9%. The reported figure also increased 7.9% year over year.

Lennar Corporation Price, Consensus and EPS Surprise

Lennar Corporation Price, Consensus and EPS Surprise

Lennar Corporation price-consensus-eps-surprise-chart | Lennar Corporation Quote

Segment Details

Homebuilding: Revenues from the segment totaled $6.53 billion, up 7.7% from the prior-year period. The increase was backed by higher number of homes delivered during the quarter.

Within the Homebuilding umbrella, home sales contributed $6.44 billion to total revenues, up 8.3% from a year ago, and land sales accounted for $89.7 million, down 21.4% from the year-ago figure.

Home deliveries during the reported quarter increased 16% year over year to 16,420, buoyed by higher number of homes delivered across all the regions served by the company.

The average sales price of homes delivered was $393,000, reflecting a 7% year-over-year decline. The decline in selling price was owing to continued shift to the entry-level market.

New orders grew 23.4% from the year-ago quarter to 13,089 homes. Potential value of net orders also increased 22.6% year over year to $5.16 billion.

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