You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate but affiliated companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
|No Recent Quote currently available|
My Portfolio Tracker
One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts. Set yours up today.
NEW YORK & CHICAGO, Jan 15, 2013 (BUSINESS WIRE) -- Lennar Corporation (NYSE:LEN) Tuesday reported better than expected fourth-quarter earnings, reflecting the company's strong liquidity position and continuing growth prospects for the U.S. housing sector, according to Fitch Ratings. The company is the third largest homebuilder in the U.S. and has an issuer default rating (IDR) of 'BB+'. Rating Outlooks for both Lennar and the U.S. housing and homebuilding sectors are Stable.
Lennar's fourth-quarter revenue jumped 42% to $1.35 billion and gross margins expanded to 23.5% from 19.4%. The company's CEO noted that low mortgage rates, affordable home prices, reduced foreclosures, and an extremely favorable "rent versus own" comparison continued to drive the U.S. housing recovery, as reflected in Lennar's earnings. Fitch sees attractive home prices, persistently low mortgage rates, and a rise in nominal incomes resulting in superior affordability and valuations. Mortgage rates remain near their all-time recorded lows, and housing appears more undervalued versus incomes than at any time in the past 35 years. Rising home prices and the potential for interest rates to increase could create a sense of urgency and encourage fence-sitters to pull the trigger and purchase a home.
Lennar maintains solid liquidity, with unrestricted homebuilding cash of $1.15 billion as of Nov. 30, 2012. The company also has an unsecured revolving credit facility of $500 million that expires in May 2015. Its debt maturities are well-laddered, with roughly 20% of its total homebuilding debt maturing through 2015.
We raised our housing forecast for 2012 a number of times during the course of the year. Nevertheless, the current forecast still reflects a below-trend line cyclical rise off a very low bottom. In a slowly growing economy with somewhat diminished distressed home sales competition, less competitive rental cost alternatives, and new home inventories at historically low levels, 2013 single-family housing starts should improve about 18%, while new home sales increase approximately 22% and existing home sales grow 7%. However, as we have noted in the past, recovery will likely occur in fits and starts.
We also adjusted expectations for home prices due to overt price increases and mix issues. Average single-family new home prices (as measured by the Census Bureau) improved an estimated 3.5% in 2012 and should rise about 3.8% in 2013.
Although home prices have stabilized and started to improve, we believe that home price appreciation will tend to be relatively narrowly focused and very sensitive to local economic, employment, and supply issues. Demand will likely continue to be affected by widespread negative equity, challenging mortgage qualification standards, and excess supply due to foreclosures. Foreclosure activity could also accelerate somewhat this year as a result of agreements between banks and the federal government.
Additional information is available on www.fitchratings.com.
The above article originally appeared as a post on the Fitch Wire credit market commentary page. The original article, which may include hyperlinks to companies and current ratings, can be accessed at www.fitchratings.com. All opinions expressed are those of Fitch Ratings.
Applicable Criteria and Related Research:
2013 Outlook: U.S. Housing and Homebuilders
SOURCE: Fitch Ratings
Fitch Ratings Robert Rulla, +1 312-606-2311 Director Corporates, Homebuilding 70 West Madison Street Chicago, IL or Robert P. Curran, +1 212-908-1515 Managing Director Corporates, Homebuilding 33 Whitehall Street New York, NY or Fitch Wire Kellie Geressy-Nilsen, +1 212-908-9123 Senior Director One State Street Plaza New York, NY or Media Relations Sandro Scenga, +1-212-908-0278 (New York) firstname.lastname@example.org
Copyright Business Wire 2013
As of Friday, 01-11-2013 23:59, the latest Comtex SmarTrendA? Alert,
an automated pattern recognition system, indicated a DOWNTREND on
06-01-2012 for LEN @ $25.48.
For more information on SmarTrend, contact your market data
provider or go to www.mysmartrend.com
SmarTrend is a registered trademark of Comtex News Network, Inc.
Copyright A? 2004-2013 Comtex News Network, Inc. All rights reserved.
Zacks Research is Reported On:
Zacks Investment Research
is an A+ Rated BBB
Copyright 2015 Zacks Investment Research
At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system. Since 1986 it has nearly tripled the S&P 500 with an average gain of +26% per year. These returns cover a period from 1986-2011 and were examined and attested by Baker Tilly, an independent accounting firm.
Visit performance for information about the performance numbers displayed above.
Visit www.zacksdata.com to get our data and content for your mobile app or website.
Real time prices by BATS. Delayed quotes by Sungard.
NYSE and AMEX data is at least 20 minutes delayed. NASDAQ data is at least 15 minutes delayed.