Lennar Earnings Beat Views Despite Drop; Housing Shortage Provides Long-Term Tailwind for Builders
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Warren Buffett-backed Lennar reported better-than-expected Q3 earnings and revenue. LEN stock fell Friday.
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Lennar earnings dropped 23% but beat views. Revenue fell 3% but topped estimates. Home deliveries increased 8%.
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The homebuilder stock rally has paused for 9 weeks, leaving some in base patterns. Heavy incentives could hurt earnings.
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U.S. has a housing shortage of 5.5M homes. New construction hasn't kept pace with population growth. Bullish long-term for builders.
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Existing home sales fell in July as high mortgage rates kept owners from selling. New home sales rose with demand steady. Fed rate hikes cool housing demand.