MIAMI - Lennar Corporation (NYSE:LEN) reported better-than-expected third quarter results as new home orders increased amid strong housing demand.
The homebuilder's stock was down 2.49% following the earnings release.
Lennar posted adjusted earnings per share of $3.90 for the quarter ended August 31, surpassing analyst estimates of $3.64. Revenue came in at $9.42 billion, also topping expectations of $9.16 billion.
New home orders increased 5% YoY to 20,587 homes, reflecting robust demand in the housing market. Deliveries rose 16% to 21,516 homes compared to the same period last year.
"We are pleased to report another solid quarter backed by an economic environment that remains very constructive for homebuilders," said Stuart Miller, Executive Chairman and Co-CEO of Lennar. "Employment was strong, housing supply remained chronically short due to production deficits of over a decade, and demand was solid driven by strong household formation."
The company's gross margin on home sales was 22.5%, while operating margin came in at 15.8%. Lennar ended the quarter with $4 billion in cash and no outstanding borrowings on its $2.2 billion revolving credit facility.
For the fourth quarter, Lennar expects deliveries between 22,500-23,000 homes and new orders of 19,000-19,300 homes. The company forecasts an average sales price of about $425,000 and gross margins to remain flat compared to Q3.
"As we look ahead to our fourth quarter, we expect to deliver between 22,500 and 23,000 homes with a gross margin flat with our third quarter," Miller added. "We will continue to fortify our balance sheet with significant liquidity and operate from a position of strength."
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