Zacks Investment Research Lowers Lennar (LEN) to Hold
Zacks Investment Research cut shares of Lennar (NYSE:LEN) from a buy rating to a hold rating in a research report released on Monday morning.
According to Zacks, “Lennar missed expectations on earnings in the final quarter of fiscal 2017 after surpassing the same for seven times in a row. Lennar’s adjusted earnings of $1.29 per share in the quarter fell shy of the Zacks Consensus Estimate by 14% and decreased 1.5% from the year-ago level of $1.31. The downside was primarily due to the strategic shift of a transaction to the first quarter of fiscal 2018. Nonetheless, its total revenues of $3.79 billion beat the consensus estimate by 4.5% and increased 12% year over year, as the homebuilding, financial services and multi-family segments performed significantly well. Lennar witnessed robust market improvement, which was supported by 11% year-over-year increase in its new home orders (18% in dollars), which was above management's 7-10% target. However, rising land and labor costs pose a threat to the company’s margins. Gross margin contracted 90 bps due to higher land and construction costs per home.”
Several other research firms have also recently weighed in on LEN. BTIG Research raised their price objective on shares of Lennar from $62.00 to $63.00 and gave the company a buy rating in a research report on Wednesday, October 4th. Royal Bank of Canada set a $82.00 target price on shares of Lennar and gave the company a buy rating in a research note on Friday, January 12th. Keefe, Bruyette & Woods reaffirmed a buy rating and issued a $78.00 target price on shares of Lennar in a research note on Thursday, January 11th. Credit Suisse Group reaffirmed a neutral rating and issued a $65.00 target price (up previously from $57.00) on shares of Lennar in a research note on Thursday, January 11th. Finally, UBS Group began coverage on shares of Lennar in a research note on Wednesday, October 25th. They issued a buy rating on the stock. One equities research analyst has rated the stock with a sell rating, seven have issued a hold rating and eleven have assigned a buy rating to the company’s stock. Lennar has an average rating of Buy and an average target price of $63.93.
Lennar (NYSE LEN) traded down $0.17 on Monday, reaching $70.54. 4,315,800 shares of the company’s stock traded hands, compared to its average volume of 4,748,983. The company has a quick ratio of 0.59, a current ratio of 7.76 and a debt-to-equity ratio of 0.72. The firm has a market cap of $16,500.00, a PE ratio of 20.33, a PEG ratio of 1.04 and a beta of 1.35. Lennar has a 52-week low of $43.46 and a 52-week high of $72.07.
Lennar (NYSE:LEN) last posted its quarterly earnings data on Wednesday, January 10th. The construction company reported $1.29 earnings per share for the quarter, missing the consensus estimate of $1.50 by ($0.21). The company had revenue of $3.79 billion during the quarter, compared to analyst estimates of $3.59 billion. Lennar had a net margin of 6.41% and a return on equity of 12.22%. The company’s revenue was up 12.1% compared to the same quarter last year. During the same quarter in the previous year, the business posted $1.34 EPS. sell-side analysts expect that Lennar will post 5.28 EPS for the current fiscal year.
The firm also recently announced a quarterly dividend, which will be paid on Friday, February 9th. Stockholders of record on Friday, January 26th will be paid a $0.04 dividend. This represents a $0.16 annualized dividend and a dividend yield of 0.23%. The ex-dividend date is Thursday, January 25th. Lennar’s dividend payout ratio (DPR) is presently 4.61%.
In related news, VP Diane J. Bessette sold 10,000 shares of Lennar stock in a transaction that occurred on Tuesday, January 16th. The shares were sold at an average price of $69.50, for a total transaction of $695,000.00. Following the transaction, the vice president now owns 222,396 shares of the company’s stock, valued at approximately $15,456,522. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, CFO Bruce E. Gross sold 5,000 shares of Lennar stock in a transaction that occurred on Tuesday, November 21st. The stock was sold at an average price of $60.00, for a total transaction of $300,000.00. Following the transaction, the chief financial officer now directly owns 371,043 shares in the company, valued at approximately $22,262,580. The disclosure for this sale can be found here. Insiders have sold a total of 165,000 shares of company stock worth $11,316,300 in the last three months. 12.18% of the stock is owned by insiders.
A number of institutional investors have recently added to or reduced their stakes in LEN. The Manufacturers Life Insurance Company boosted its stake in Lennar by 5.4% during the 2nd quarter. The Manufacturers Life Insurance Company now owns 7,516,323 shares of the construction company’s stock worth $400,771,000 after acquiring an additional 386,110 shares during the last quarter. Capital Growth Management LP boosted its stake in Lennar by 28.2% during the 3rd quarter. Capital Growth Management LP now owns 1,090,000 shares of the construction company’s stock worth $57,552,000 after acquiring an additional 240,000 shares during the last quarter. Janus Henderson Group PLC boosted its stake in Lennar by 268.3% during the 3rd quarter. Janus Henderson Group PLC now owns 162,638 shares of the construction company’s stock worth $8,587,000 after acquiring an additional 118,482 shares during the last quarter. Stevens Capital Management LP boosted its stake in Lennar by 374.1% during the 2nd quarter. Stevens Capital Management LP now owns 114,099 shares of the construction company’s stock worth $6,084,000 after acquiring an additional 90,035 shares during the last quarter. Finally, Patriot Wealth Management Inc. bought a new position in Lennar in the fourth quarter valued at approximately $5,563,000. 81.25% of the stock is currently owned by institutional investors and hedge funds.
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Lennar Corporation is a provider of real estate related financial services, commercial real estate, investment management and finance company. The Company is a homebuilder that operates in various states. Its segments include Homebuilding East, Homebuilding Central, Homebuilding West, Lennar Financial Services, Rialto and Lennar Multifamily.
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