Homebuilder Lennar (LEN) - Get Report on Wednesday posted third-quarter earnings that handily exceeded analysts' forecasts amid an ongoing revival in demand for new homes - a reflection of a still-healthy U.S. economy on the back of still-favorable consumer borrowing costs.
The Miami-based company reported net income of $513.4 million, or $1.59 a share, vs. $453.2 million, or $1.37 cents a share, in the comparable year-earlier period. Analysts polled by FactSet had been expecting earnings of $1.32 a share.
Revenue came in at $5.44 billion, above analysts' forecasts of $5.32 billion and also above last year's $5.29 billion. The company handed over the keys to some 13,522 completed homes, an increase of 7%, while orders for new homes gained 7% to 14,469, which translated into a dollar value of $5.2 billion.
Lennar CEO Stuart Miller said the company benefited from demand for new homes among consumers at the hands of lower mortgage rates, which in turn is driving homebuilding cash flow, "... which is trending towards $1.5 billion for fiscal 2019."
Miller added that the company paid off $1.6 billion of senior notes since its acquisition of CalAtlantic, and will pay off another $600 million of senior notes by next month. Lennar also repurchased 6.1 million shares in the third quarter for $296 million, and 14.1 million shares for $645 million over the last 12 months.
Shares of Lennar were up 1.3% in morning trading on Wednesday, gaining 73 cents to $56.42 on the New York Stock Exchange.
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