Lennar Corp. (NYSE: LEN): Q1 Earnings Preview 2011

Lennar Corp. (NYSE: LEN), the third-largest U.S. homebuilder by revenue, is scheduled to release first-quarter earnings before the opening bell on Tuesday, March 29 2011. Analysts, on average, expect the company to report a loss of 5 cents per share on revenue of $508.23 million. In the year-ago period, the company posted a loss of 4 cents per share on revenue of $574.44 million.

In the preceding fiscal fourth-quarter, the Miami, Florida based company's net income was $32.0 million, or 17 cents per share, compared with a profit of $35.6 million, or 19 cents per share, in the same period a year ago. Revenue dropped 6% to $860.1 million. Analysts, on average, has expected earnings of 6 cents a share on revenue of $815.75 million. 

At its last earnings call in January, the company said that 2011 will be another profitable year, whether or not the economy strengthens."Lennar said that its homebuilding segment is on the right track to achieving sustainable profitability and Rialto Investments segment will enhance earnings as the housing market stabilizes and ultimately recovers."Although high unemployment, tight lending standards and low consumer confidence continue to present challenges for the housing industry, we are confident that 2011 will be another profitable year," he said. "Our homebuilding segment is on the right track to achieving sustainable profitability, and our Rialto Investments segment will enhance our earnings as the housing market stabilizes and ultimately recovers," stated CEO Stuart Miller.

Lennar has been very selective in its homebuilding, seeking areas where demand for housing exists. During its fourth quarter, Lennar gained marketshare, cut administrative and manufacturing costs and saw Rialto, its new distressed land investment business, account for $12.4 million, or 39 percent, of the bottom line. Rialto also gives Lennar an inside track for its own home-building business on land deals that have not yet hit the market, the company said.

There appears to be a continuing lack of recovery in the housing market. This week alone, data showed the pace of new-home sales fell to a near 50-year low in February while sales of previously owned homes also slumped. The median sales price of a new home is back to 2003 levels. While the broader market is still up more than 10% from a year ago, the SPDR S&P Homebuilders ETF (XHB) has trailed the S&P 500's gains. 

The company's stock currently trades at a forward P/E (fye Nov 30, 2012) of 16.02 and PEG Ratio (5 yr expected) of 6.88. In terms of stock performance, Lennar shares have lost more than 33% over the past year.

Full Disclosure: None.

Lennar Corp. (NYSE: LEN): Q4 Earnings Preview 2010

Lennar Corp. (NYSE: LEN), the third-largest U.S. homebuilder by revenue, is scheduled to release fourth-quarter earnings before the market open on Tuesday, January 11, 2011. Analysts, on average, expect the company to report earnings of 2 cents per share on revenue of $754.08 million. In the year-ago period, the company reported earnings of 19 cents per share on revenue of $913.74 million.

Lennar Corporation, together with its subsidiaries, operates as a home builder and provider of financial services in the United States. The home building operations include the construction and sale of single-family attached and detached homes, multi-level residential buildings, as well as the purchase and sale of residential land directly, and through unconsolidated entities in which the Company have investments.

In the preceding third quarter, the Miami, Florida-based company's net income was $30 million, or 16 cents a share, compared to a loss of $171.6 million, or 97 cents a share, in the year-earlier quarter. Revenue rose 14% to $825 million from $720.73. Analysts, on average, expected the company to report earnings of 4 cents per share on revenue of $765.19 million. 

Lennar has been expanding its distressed real estate arm, Rialto Investments, as demand for new houses slumps. The company bought a 40 percent stake in a $3 billion portfolio of loans auctioned by the Federal Deposit Insurance Corp. in February, and said last month it acquired an additional $740 million of distressed loans and property from financial institutions. Rialto had operating earnings of about $7.7 million in the quarter ended Aug. 31. The unit’s revenue totaled $38 million, or 4.6 percent of the Miami-based company’s total.

The housing market, which appeared poised for a recovery earlier in the year, now could be heading for a second downward drift. A new bout of declining home prices is threatening to hamper the U.S. recovery, just as consumers and the overall economy have been showing signs of healing. Home prices across 20 major metropolitan areas fell 1.3% in October from September, the third straight month-over-month drop, according to the S&P/Case-Shiller home-price index. Many economists expect the declines to continue into at least next spring, erasing most of the gains made since prices bottomed out in early 2009.

Meanwhile, existing-home sales rose 5.6% last month to a seasonally adjusted annual rate of 4.68 million units, the National Association of Realtors said recently. Despite the uptick, the road to a sustainable housing recovery is long. . Last month's pace of sales of previously occupied homes remains 27.9% below year-earlier levels in Nov. 2009, the initial deadline for the first-time buyer tax credit. Homebuilders, themselves, remain discouraged about the job market and large number of foreclosures. The National Association of Home Builders said recently that builders' sentiment remained unchanged in the last month. The piece of data -- known as The National Association of Home Builders/Wells Fargo housing market index -- stands at 16. Any reading below 50 is said to imply negative sentiment about the market.

In terms of stock performance, Lennar shares have gained more than 35% over the past year.

Full Disclosure: None.