Homebuilder Lennar (LEN) reports better-than-expected fiscal third-quarter earnings late Monday. Lennar stock fell modestly on the report after rising into results. Other homebuilder stocks were mixed Monday but have fared relatively well.
Low mortgage rates are propping up housing demand during the coronavirus pandemic.
Estimates: Wall Street expected Lennar earnings per share to fall 5% to $1.51. Revenue was seen decreasing 9% to $5.33 billion.
Results: Lennar earnings jumped 33% to $2.12 a share. Revenue inched up to $5.87 billion. Deliveries rose 2% to 13,842. New orders climbed 16% to 15,564 homes.
The builder sees Q4 orders of 13,800-14,300 with deliveries at 15,500-16,000.
Lennar stock fell 3% in overnight trading. Shares closed up 2% to 79 in Monday’s stock market trading. Lennar stock, which has a 96 Composite Rating and a 96 EPS Rating, bounced off its 50-day line last week
Among other homebuilder stocks, LGI Homes (LGIH), which focuses on entry-level single-family homes, closed flat at 112.49. LGI Homes is testing support at its 50-day line. The stock has a possible buy point of 124.04. Upscale homebuilder Toll Brothers (TOL) fell 1.1%.
LGI, a Leaderboard member, reported quarterly results last month that beat expectations. The company said “low interest rates, an undersupply of existing homes and a renewed appreciation for the value of homeownership” helped drive demand. Toll Brothers made similar remarks when it reported earnings last month. Those results also beat expectations.
As homebuilder stocks rise, signs have also emerged of an increase in home redecorations, as more people work from home with fewer things to do outside. Premium furniture chain RH (RH), formerly known as Restoration Hardware, said last week that it expected “elevated spending on the home” in the months ahead.
Home-goods and cookware retailer Williams-Sonoma (WSM), when it reported earnings in August, said it believed “the behavioral changes and industry shifts that have emerged from the pandemic will persist and continue to favor our business.”
Williams-Sonoma CEO Laura Alber, during the company’s earnings call, said the financial results prompted the company to speed up digital growth, among other long-term plans. She said the company was operating in a time when “home is more important than ever.”
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