Lennar Beats Estimates as Low Interest Rates, Jobs Boost Demandby
Lennar Corp., the second-largest U.S. homebuilder, reported fiscal third-quarter earnings that beat analysts’ estimates as low borrowing costs and job growth bolstered buyer demand for houses nationwide.
Net income for the three months through August totaled $235.8 million, or $1.01 a share, compared with $223.3 million, or 96 cents, a year earlier, the Miami-based company said in a statement Tuesday. The average estimate of 13 analysts was for earnings of 90 cents a share, according to data compiled by Bloomberg.
Lennar, one of the industry’s most successful firms, loaded up on land during the crash, when prices were cheap, and is now benefiting as demand rises. Confidence among homebuilders rose to an 11-month high in September, indicating the housing market will continue to advance, according to data Monday from the National Association of Home Builders/Wells Fargo.
“They still have one of the most-well-regarded land banks in the industry,” Drew Reading, an analyst with Bloomberg Intelligence, said before Lennar announced its earnings. “So, even though they’re moderating the pace of future investment, they can be opportunistic about future deals.”
The builder delivered 6,779 homes in the quarter, up 7 percent from a year earlier. The average selling price of delivered homes climbed 3 percent to $362,000. New orders rose 8 percent to 7,018 homes.