The latest trading session saw Lennar (LEN) ending at $111.17, denoting a -0.62% adjustment from its last day's close. The stock's performance was behind the S&P 500's daily gain of 0.09%. Elsewhere, the Dow gained 0.32%, while the tech-heavy Nasdaq added 0.02%.
The the stock of homebuilder has risen by 6.81% in the past month, lagging the Construction sector's gain of 17.05% and the S&P 500's gain of 13.05%.
The investment community will be paying close attention to the earnings performance of Lennar in its upcoming release. The company's upcoming EPS is projected at $1.98, signifying a 41.42% drop compared to the same quarter of the previous year. In the meantime, our current consensus estimate forecasts the revenue to be $8.3 billion, indicating a 5.26% decline compared to the corresponding quarter of the prior year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $10.15 per share and a revenue of $36.09 billion, indicating changes of -26.77% and +1.84%, respectively, from the former year.
It is also important to note the recent changes to analyst estimates for Lennar. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.11% lower. Right now, Lennar possesses a Zacks Rank of #5 (Strong Sell).
Digging into valuation, Lennar currently has a Forward P/E ratio of 11.02. For comparison, its industry has an average Forward P/E of 9.88, which means Lennar is trading at a premium to the group.
Investors should also note that LEN has a PEG ratio of 3.06 right now. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. As of the close of trade yesterday, the Building Products - Home Builders industry held an average PEG ratio of 1.82.
The Building Products - Home Builders industry is part of the Construction sector. With its current Zacks Industry Rank of 231, this industry ranks in the bottom 7% of all industries, numbering over 250.
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 use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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Lennar Corporation (LEN): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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