MIAMI (AP) — Lennar's second-quarter net income fell 70 percent compared with year-ago figures that included a hefty income tax benefit. But adjusted earnings and revenue beat Wall Street's view, and the homebuilder's new orders and deliveries continued to climb.
CEO Stuart Miller said Tuesday that demand in all of Lennar's housing markets continues to outpace supply, which is being constrained due to limited land availability and fewer competing homebuilders. While interest rates are rising, Miller said in a statement that there so far seems to be little impact on home sales or pricing.
Its shares rose 11 cents to $35.10 in premarket trading on Tuesday.
Like many homebuilders, Lennar's business is strengthening as the housing market recovery builds momentum. Lennar Corp. sells homes for entry level and move-up buyers as well as retirees.
Homebuilders are a bellwether for the housing market and the economy. While new homes represent less than one-fifth of the total housing market, construction of houses has a major impact on the economy.
For the three months ended May 31, Lennar earned $137.4 million, or 61 cents per share. That compares with $452.7 million, or $2.06 per share, a year earlier.
The prior-year period included an income tax benefit of $402.3 million.
Stripping out the income tax benefit and other items, earnings were 43 cents per share compared with 21 cents per share a year ago.
Analysts, on average, predicted earnings of 33 cents per share, according to a FactSet survey.
Revenue for the Miami company increased to $1.43 billion from $930.2 million. Wall Street expected $1.3 billion in revenue.
Home deliveries climbed 39 percent to 4,464 homes, while new orders rose 27 percent to 5,705 homes.
Backlog, a key indicator of potential future revenue, increased 55 percent to 6,163 homes.