Earnings Review and Free Research Report: Lennar's Quarterly Sales Increased 19%; Reported its Highest Quarterly New Orders in a Decade
Research Desk Line-up: KB Home Post Earnings Coverage
LONDON, UK / ACCESSWIRE / July 5, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Lennar Corp. (NYSE: LEN), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=LEN, following the Company's announcement of its second quarter fiscal 2017 financial results on June 20, 2017. The homebuilder outperformed top- and bottom-line expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:
http://protraderdaily.com/register/
Get more of our free earnings reports coverage from other constituents of the Residential Construction industry. Pro-TD has currently selected KB Home (NYSE: KBH) for due-diligence and potential coverage as the Company reported on June 27, 2017, its financial results for Q2 2017 which ended on May 31, 2017. Register for a free membership today, and be among the early birds that get access to our report on KB Home when we publish it.
At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on LEN; also brushing on KBH. With the links below you can directly download the report of your stock of interest free of charge at:
http://protraderdaily.com/optin/?symbol=LEN
http://protraderdaily.com/optin/?symbol=KBH
Earnings Reviewed
For its second quarter ended May 31, 2017, Lennar's revenue rose to $3.26 billion compared to $2.75 billion in Q2 FY16, beating the analysts' consensus of $2.81 billion, as all revenue segments, such as home and land sales, financial, Rialto, and multifamily, all beat analysts' projections.
Lennar reported its highest quarterly new orders in the last ten years of 8,898 homes, a 12% increase on a y-o-y basis. Home deliveries and revenues from home sales increased 15% to 7,710 homes and 18%, respectively on a y-o-y basis, while the Company's backlog dollar value increased 20% to $4.0 billion and backlog of homes advanced 135 to 10,201 homes.
Second quarter net earnings attributable to Lennar in 2017 were $213.6 million, or $0.91 per diluted share, compared to second quarter net earnings attributable to Lennar in 2016 of $218.5 million, or $0.95 per diluted share. The Company's earnings surpassed Wall Street's expectations of $0.79 per share.
Segment Results
During Q2 FY17, Lennar Homebuilding revenues surged 18% to $2.9 billion from $2.4 billion in the second quarter of 2016, driven by a 15% increase in the number of home deliveries, excluding unconsolidated entities, and a 3% increase in the average sales price of homes delivered.
The Company's new home deliveries, excluding unconsolidated entities, increased to 7,687 homes in Q2 FY17 from 6,711 homes in Q2 FY16, with increase in home deliveries in all of the Company's Homebuilding segments and Homebuilding Other. For Q2 FY17, the average sales price of homes delivered was $374,000 compared to $362,000 in Q2 FY16.
Lennar's sales incentives offered to homebuyers were $22,700 per home delivered in the reported quarter, or 5.7% as a percentage of home sales revenue, compared to $21,800 per home delivered in the prior year's same quarter, or 5.7% as a percentage of home sales revenue.
Lennar's gross margins on home sales were $616.9 million, or 21.5%, in Q2 FY17 compared to $561.5 million, or 23.1%, in Q2 FY17. The decline was attributed to an increase in construction and land costs per home. The Company's selling, general, and administrative expenses were $268.4 million in the reported quarter compared to $224.8 million in the prior year's same quarter.
Lennar Homebuilding interest expense was $71.9 million in Q2 FY17 comprising of $69.9 million included in costs of homes sold, $0.7 million in costs of land sold, and $1.3 million in other income, net, compared to $63.9 million in Q2 FY16 consisting of $62.1 million included in costs of homes sold, $0.6 million in costs of land sold, and $1.2 million in other income, net.
During Q2 FY17, operating earnings for the Lennar Financial Services segment were $43.7 million compared to $44.1 million in Q2 FY16. Operating earnings were impacted by a significant decrease in refinance transactions, offset by higher profit per transaction in the segment's title operations.
Lennar's operating earnings for the Rialto segment were $6.2 million in Q2 FY17 which included a $6.5 million operating loss and an add back of $12.6 million of net loss attributable to non-controlling interests compared to operating loss in Q2 FY16 of $13.8 million, which was comprised of an $18.1 million operating loss and an add back of $4.3 million of net loss attributable to non-controlling interests.
In Q2 FY17, operating earnings for the Lennar Multifamily segment were $6.5 million compared to operating earnings of $14.9 million in Q2 FY16.
Cash Matters
At the end of Q2 FY17, Lennar Homebuilding has cash and cash equivalents of $748 million. In the reported quarter, Lennar issued $650 million of 4.50% senior notes due 2024 and retired its 12.25% senior notes due 2017. The Company increased its credit facility to $2.0 billion. At the end of Q2 FY17, Lennar Homebuilding debt to total capital, net of cash and cash equivalents was 40.7%.
Stock Performance
At the closing bell, on Monday, July 03, 2017, Lennar's stock declined 1.34%, ending the trading session at $52.56. A total volume of 1.12 million shares have exchanged hands. The Company's stock price surged 3.24% in the last three months, 22.43% in the past six months, and 13.23% in the previous twelve months. Moreover, the stock rallied 22.43% since the start of the year. The stock is trading at a PE ratio of 15.23 and has a dividend yield of 0.30%. The stock currently has a market cap of $11.93 billion.
Pro-Trader Daily:
Pro-Trader Daily (Pro-TD) produces regular sponsored and non-sponsored reports, articles, stock market blogs, and popular investment newsletters covering equities listed on NYSE and NASDAQ and Canadian stocks. PRO-TD has two distinct and independent departments. One department produces non-sponsored analyst certified content generally in the form of press releases, articles and reports covering equities listed on NYSE and NASDAQ and the other produces sponsored content (in most cases not reviewed by a registered analyst), which typically consists of compensated investment newsletters, articles and reports covering listed stocks and micro-caps. Such sponsored content is outside the scope of procedures detailed below.
PRO-TD has not been compensated; directly or indirectly; for producing or publishing this document.
PRESS RELEASE PROCEDURES:
The non-sponsored content contained herein has been prepared by a writer (the "Author") and is fact checked and reviewed by a third party research service company (the "Reviewer") represented by a credentialed financial analyst, for further information on analyst credentials, please email contact@protraderdaily.com. Rohit Tuli, a CFA® charterholder (the "Sponsor"), provides necessary guidance in preparing the document templates. The Reviewer has reviewed and revised the content, as necessary, based on publicly available information which is believed to be reliable. Content is researched, written and reviewed on a reasonable-effort basis. The Reviewer has not performed any independent investigations or forensic audits to validate the information herein. The Reviewer has only independently reviewed the information provided by the Author according to the procedures outlined by PRO-TD. PRO-TD is not entitled to veto or interfere in the application of such procedures by the third-party research service company to the articles, documents or reports, as the case may be. Unless otherwise noted, any content outside of this document has no association with the Author or the Reviewer in any way.
NO WARRANTY
PRO-TD, the Author, and the Reviewer are not responsible for any error which may be occasioned at the time of printing of this document or any error, mistake or shortcoming. No liability is accepted whatsoever for any direct, indirect or consequential loss arising from the use of this document. PRO-TD, the Author, and the Reviewer expressly disclaim any fiduciary responsibility or liability for any consequences, financial or otherwise arising from any reliance placed on the information in this document. Additionally, PRO-TD, the Author, and the Reviewer do not (1) guarantee the accuracy, timeliness, completeness or correct sequencing of the information, or (2) warrant any results from use of the information. The included information is subject to change without notice.
NOT AN OFFERING
This document is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Please read all associated disclosures and disclaimers in full before investing. Neither PRO-TD nor any party affiliated with us is a registered investment adviser or broker-dealer with any agency or in any jurisdiction whatsoever. To download our report(s), read our disclosures, or for more information, visit http://protraderdaily.com/disclaimer/.
CONTACT
For any questions, inquiries, or comments reach out to us directly. If you're a company we are covering and wish to no longer feature on our coverage list contact us via email and/or phone between 09:30 EDT to 16:00 EDT from Monday to Friday at:
Email: contact@protraderdaily.com
Phone number: (917) 341.4653
Office Address: Mainzer Landstrasse 50 Frankfurt am Main, Germany 60325
CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.
SOURCE: Pro-Trader Daily
