We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate 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.
Lennar Corporation (LEN - Free Report) is one of the largest U.S. homebuilders.
LEN stock has tanked roughly 45% from its September highs as its earnings estimates plummet amid a slowing housing market and persistent inflation across many critical aspects of its business.
What Investors Need to Know About Lennar
Lennar Corporation is a top U.S. homebuilder focused on what it calls affordable, move-up, and active adult homes. Its financial services segment offers mortgage financing, title, closing services, and more for Lennar homebuyers. On top of that, Lennar develops high-quality multifamily rental properties across the country.
The company is attempting to navigate challenges plaguing the entire homebuilding industry and housing market more broadly.
Lingering inflation took a toll on Lennar’s margins throughout fiscal 2024 and into Q1 FY25, which it reported on March 20.
Image Source: Zacks Investment Research
Lennar closed Q1 fiscal 2025 with a gross margin on home sales of 18.7%, down 310 basis points (bps) YoY. The decline was mainly due to decreased revenue per square foot and increased land costs. Higher sales incentives and mortgage rate buydowns, which Lennar used to combat affordability challenges, also impacted margins.
The company’s fiscal 2025 consensus earnings estimate tanked 18% since its first quarter release, with its FY26 estimate 26% lower.
Lennar’s downward EPS revision trends extended a rough stretch that heated up after its Q4 FY24 release. “Our first quarter was marked by a challenging macroeconomic environment for homebuilding,” Co-CEO Stuart Miller said in prepared remarks.
Image Source: Zacks Investment Research
“While demand remains strong, persistently higher interest rates and inflation, combined with a downturn in consumer confidence and a limited supply of affordable homes, made it increasingly difficult for consumers to access homeownership.”
Time to Stay Away from Lennar Stock?
Lennar’s negative earnings estimate revisions help it land a Zacks Rank #5 (Strong Sell). The stock is down roughly 45% from its highs, including a 25% YTD drop.
LEN’s rough performance pushed it below its 200-week moving average and to its most oversold RSI levels in the past decade.
Some investors might think about dipping their toes into Lennar at these levels. But it is a risky time to attempt to call a bottom on hard-hit Lennar stock until there are signs that the tides might start turning across the broader homebuilder market.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Bear of the Day: Lennar Corporation (LEN)
Lennar Corporation (LEN - Free Report) is one of the largest U.S. homebuilders.
LEN stock has tanked roughly 45% from its September highs as its earnings estimates plummet amid a slowing housing market and persistent inflation across many critical aspects of its business.
What Investors Need to Know About Lennar
Lennar Corporation is a top U.S. homebuilder focused on what it calls affordable, move-up, and active adult homes. Its financial services segment offers mortgage financing, title, closing services, and more for Lennar homebuyers. On top of that, Lennar develops high-quality multifamily rental properties across the country.
The company is attempting to navigate challenges plaguing the entire homebuilding industry and housing market more broadly.
Lingering inflation took a toll on Lennar’s margins throughout fiscal 2024 and into Q1 FY25, which it reported on March 20.
Image Source: Zacks Investment Research
Lennar closed Q1 fiscal 2025 with a gross margin on home sales of 18.7%, down 310 basis points (bps) YoY. The decline was mainly due to decreased revenue per square foot and increased land costs. Higher sales incentives and mortgage rate buydowns, which Lennar used to combat affordability challenges, also impacted margins.
The company’s fiscal 2025 consensus earnings estimate tanked 18% since its first quarter release, with its FY26 estimate 26% lower.
Lennar’s downward EPS revision trends extended a rough stretch that heated up after its Q4 FY24 release. “Our first quarter was marked by a challenging macroeconomic environment for homebuilding,” Co-CEO Stuart Miller said in prepared remarks.
Image Source: Zacks Investment Research
“While demand remains strong, persistently higher interest rates and inflation, combined with a downturn in consumer confidence and a limited supply of affordable homes, made it increasingly difficult for consumers to access homeownership.”
Time to Stay Away from Lennar Stock?
Lennar’s negative earnings estimate revisions help it land a Zacks Rank #5 (Strong Sell). The stock is down roughly 45% from its highs, including a 25% YTD drop.
LEN’s rough performance pushed it below its 200-week moving average and to its most oversold RSI levels in the past decade.
Some investors might think about dipping their toes into Lennar at these levels. But it is a risky time to attempt to call a bottom on hard-hit Lennar stock until there are signs that the tides might start turning across the broader homebuilder market.