MIAMI -- Shares of major U.S. homebuilders rose Thursday after Lennar's (LEN - Get Report) second-quarter earnings report showed a significant spike in sales of completed homes and new orders compared with the prior three-month period.
Lennar reported Thursday a 47% increase in sales of completed homes and a 63% jump in orders from the first quarter. Lennar also reported a 15% cancellation rate for the second quarter, considerably smaller than the 22% posted in the same quarter last year.
Revenue dropped to $891.9 million from $1.13 billion on a year-over-year basis, but the Miami-based builder still managed to beat Wall Street's $597.5 million revenue estimate.
All that news sent Lennar's shares up as much as 18% after closing at $7.82 per share on Wednesday. Lennar rose $1.37, or 17.5%, to $9.19 at the close Thursday.Investors in other homebuilders appeared motivated by Lennar's results. KB Home (KBH - Get Report) rose $1.13 , or 8.3%, to $14.77, while Centex (CTX) gained 47 cents, or 5.8%, to $8.58. Pulte Homes (PHM - Get Report) was up 49 cents, or 5.8%, to $8.96, and Toll Brothers (TOL - Get Report) increased 85 cents, or 5.2%, to $17.09. The positive news in Lennar's report seemed to overshadow the company's slightly larger loss from last year's second quarter. Lennar lost $125.2 million, or 76 cents a share, for the three months ended May 31. Lennar posted a loss of $120.9 million, or 76 cents a share, in the second quarter last year. The quarterly loss included 38 cents per share for adjustments in the value of land and inventory, and a 27 cents-per-share charge related to tax asset values.