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The most recent trading session ended with Lennar (LEN) standing at $107.81, reflecting a +1.52% shift from the previouse trading day's closing. The stock's change was more than the S&P 500's daily gain of 0.44%. At the same time, the Dow added 0.7%, and the tech-heavy Nasdaq gained 0.27%.
Prior to today's trading, shares of the homebuilder had gained 3.15% over the past month. This has lagged the Construction sector's gain of 11.65% and the S&P 500's gain of 10.62% in that time.
The upcoming earnings release of Lennar will be of great interest to investors. The company is forecasted to report an EPS of $1.98, showcasing a 41.42% downward movement from the corresponding quarter of the prior year. Meanwhile, our latest consensus estimate is calling for revenue of $8.3 billion, down 5.26% from the prior-year quarter.
For the full year, the Zacks Consensus Estimates project earnings of $10.15 per share and a revenue of $36.09 billion, demonstrating changes of -26.77% and +1.84%, respectively, from the preceding year.
It is also important to note the recent changes to analyst estimates for Lennar. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. The Zacks Consensus EPS estimate has moved 2.92% lower within the past month. At present, Lennar boasts a Zacks Rank of #5 (Strong Sell).
In the context of valuation, Lennar is at present trading with a Forward P/E ratio of 10.47. For comparison, its industry has an average Forward P/E of 8.84, which means Lennar is trading at a premium to the group.
It is also worth noting that LEN currently has a PEG ratio of 2.9. 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 average PEG ratio for the Building Products - Home Builders industry stood at 1.23 at the close of the market yesterday.