Lennar (LEN) closed at $118.77 in the latest trading session, marking a +2.41% move from the prior day. The stock exceeded the S&P 500, which registered a gain of 1.47% for the day. Elsewhere, the Dow gained 1.34%, while the tech-heavy Nasdaq added 1.95%.
The homebuilder's stock has climbed by 5.32% in the past month, exceeding the Construction sector's gain of 2.77% and the S&P 500's gain of 0.64%.
The investment community will be closely monitoring the performance of Lennar in its forthcoming earnings report. The company is predicted to post an EPS of $2.14, indicating a 45.13% decline compared to the equivalent quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $9.07 billion, indicating a 3.7% decrease compared to the same quarter of the previous year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $9.04 per share and revenue of $35.22 billion. These totals would mark changes of -34.78% and -0.63%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for Lennar. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 2.87% lower. As of now, Lennar holds a Zacks Rank of #5 (Strong Sell).
In the context of valuation, Lennar is at present trading with a Forward P/E ratio of 12.83. This represents a premium compared to its industry average Forward P/E of 10.77.
We can additionally observe that LEN currently boasts a PEG ratio of 4.92. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As of the close of trade yesterday, the Building Products – Home Builders industry held an average PEG ratio of 2.23.
The Building Products – Home Builders industry is part of the Construction sector. This group has a Zacks Industry Rank of 227, putting it in the bottom 9% of all 250+ industries.
