Lennar (LEN) Investors Show Jitters Despite Impressive Q4

January 15, 2013 9:06 AM EST
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On Tuesday homebuilder Lennar (NYSE: LEN) reported Q4 results that topped estimates on the top and bottom line. Despite the beat, shares were choppy in pre-market trading.

Lennar Corp. reported revenue of $1.35 billion, topping estimates of $1.32 billion. Last year the homebuilder reported revenue of only $952 million. Deliveries were up 32 percent and backlog totaled 4053 thousand homes or $1.2 billion.

Lennar reported Q4 EPS of $0.56, $0.11 better than the analyst estimate of $0.45. The beat was driven by improved operating margin on home sales, which increased to 12.2 percent.

Orders were 3,871, up 32 percent and better than Wall Street expectations of a 25 percent rise.

Gross margin on home sales of 23.5 percent was also slightly above the Street's 23.1%. In addition, SG&A was kept in check at just 10.9 percent of sales versus an expected 11.6%.

Lennar's success is further evidence of a sustained recovery in housing, said the CEO.

Stuart Miller, Chief Executive Officer of Lennar Corporation, said, "Our fourth quarter reflects the recovery in housing with solid profitability in all of our business segments. Our homebuilding sales pace continued to grow with a 32% increase in new orders, while our homebuilding gross margin percentage increased 410 basis points over last year to 23.5% and our homebuilding operating margin percentage increased 660 basis points over last year to 12.2%."

Shares of Lennar are lower by 0.6 percent in early trading.

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