Lennar (LEN) Dips More Than Broader Markets: What You Should Know

This story originally appeared on Zacks

In the latest trading session, Lennar (LEN) closed at $95.61, marking a -1.29% move from the previous day. This move lagged the S&P 500’s daily loss of 1.1%. Meanwhile, the Dow lost 0.89%, and the Nasdaq, a tech-heavy index, added 0.03%.

Coming into today, shares of the homebuilder had lost 13.79% in the past month. In that same time, the Construction sector lost 6.54%, while the S&P 500 lost 1.81%.

Wall Street will be looking for positivity from Lennar as it approaches its next earnings report date. In that report, analysts expect Lennar to post earnings of $2.60 per share. This would mark year-over-year growth of 27.45%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $6.19 billion, up 16.23% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $15.82 per share and revenue of $32.9 billion, which would represent changes of +10.86% and +21.28%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for Lennar. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 1.44% higher. Lennar is currently a Zacks Rank #1 (Strong Buy).

In terms of valuation, Lennar is currently trading at a Forward P/E ratio of 6.12. For comparison, its industry has an average Forward P/E of 5.37, which means Lennar is trading at a premium to the group.

Meanwhile, LEN’s PEG ratio is currently 0.99. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. The Building Products – Home Builders industry currently had an average PEG ratio of 0.25 as of yesterday’s close.

The Building Products – Home Builders industry is part of the Construction sector. This group has a Zacks Industry Rank of 36, putting it in the top 15% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow LEN in the coming trading sessions, be sure to utilize Zacks.com.

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