Lennar Tops Revenue Estimates, Profit Falls Short as Discounts Fuel Home Sales

Shares of Lennar Corp. (LEN) rose in premarket trading Tuesday, a day after the homebuilder posted a mixed second-quarter report, with revenue topping analysts’ expectations but profit, new orders, and average sale price falling short.

After the bell Monday, the Miami-based firm reported earnings per share of $1.81 on revenue that decreased more than 4% year-over-year to $8.38 billion. Analysts surveyed by Visible Alpha had expected $1.96 and $8.29 billion, respectively.

Lennar generated 22,601 new orders and 20,131 home deliveries with an average sales price of $389,000, while analysts were looking for 22,934, 20,019, and $400,690, respectively. Last quarter, Lennar guided for 22,500 to 23,500 new orders and 19,500 to 20,500 deliveries with an average sales price of $390,000 to $400,000.

“While we continue to see softness in the housing market due to affordability challenges and a decline in consumer confidence, we adhered to our strategy of driving starts, sales, and closings in order to build long-term efficiencies in our business,” Lennar co-CEO Stuart Miller said.

For the third quarter, Lennar expects 22,000 to 23,000 new orders and an identical range for deliveries, with an average sales price of $380,000 to $385,000. Analysts were calling for 22,542 new orders and 23,645 deliveries with an average sales price of $398,260.

Lennar shares, which entered Tuesday down 17% this year, advanced 2% before the opening bell.