Lennar Corporation (LEN), a prominent name in the homebuilding industry, delivered impressive third-quarter financial results, exceeding analysts’ expectations. The company reported earnings per share of $3.90, surpassing the consensus estimate of $3.63 by a healthy 7.44%. Revenue for the quarter reached $9.416 billion, surpassing the anticipated $9.164 billion and marking a 7.86% year-over-year increase.
The positive performance was driven by strong demand for homes. New orders climbed 5% to 20,587 homes, while deliveries soared by 16% to 21,516 homes. This growth reflects the ongoing housing shortage and robust economic conditions. Lennar’s backlog, consisting of 16,944 homes valued at $7.7 billion, underscores the strong demand and positions the company for continued growth in the coming quarters.
Despite affordability challenges, Lennar’s strategic use of sales incentives played a key role in attracting buyers. Stuart Miller, executive chairman and Co-CEO of Lennar, highlighted the positive economic backdrop and the persistent housing shortage. He emphasized that, “Although affordability continued to be tested during the quarter, purchasers remained responsive to increased sales incentives, resulting in a 16% increase in our deliveries and a 5% increase in our new orders year over year.”
Looking ahead, Lennar anticipates continued strong performance. The company projects fourth-quarter new orders in the range of 19,000 to 19,300 and deliveries between 22,500 and 23,000. The average sales price is expected to hover around $425,000.
The positive outlook for Lennar has resonated with analysts. BofA Securities analyst Rafe Jadrosich maintained a Neutral rating on Lennar but raised the price target from $171 to $190 following the strong earnings report.
In after-hours trading, Lennar shares experienced a decline of 3.36% to $185.99, following a 2.13% gain during the regular trading session.
