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Lennar (LEN) Outpaces Stock Market Gains: What You Should Know

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Lennar (LEN - Free Report) closed at $85.60 in the latest trading session, marking a +0.73% move from the prior day. The stock outpaced the S&P 500's daily gain of 0.13%. Meanwhile, the Dow gained 0.05%, and the Nasdaq, a tech-heavy index, lost 0.5%.

Coming into today, shares of the homebuilder had gained 3.36% in the past month. In that same time, the Construction sector gained 0.61%, while the S&P 500 gained 1.1%.

LEN will be looking to display strength as it nears its next earnings release. In that report, analysts expect LEN to post earnings of $1.62 per share. This would mark year-over-year growth of 27.56%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.03 billion, up 11.73% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $8.50 per share and revenue of $24.91 billion, which would represent changes of +8.28% and +10.79%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for LEN. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. LEN is currently a Zacks Rank #3 (Hold).

Looking at its valuation, LEN is holding a Forward P/E ratio of 10.29. This valuation marks a premium compared to its industry's average Forward P/E of 8.6.

Meanwhile, LEN's PEG ratio is currently 1.19. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Building Products - Home Builders was holding an average PEG ratio of 0.75 at yesterday's closing price.

The Building Products - Home Builders industry is part of the Construction sector. This group has a Zacks Industry Rank of 34, putting it in the top 14% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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