Lennar Corporation (NYSE:LEN) stock fell 1.84% (As on Sep 21, 11:27:08 AM UTC-4, Source: Google Finance) after the company expects supply chain challenges in the homebuilding industry to continue and forecast fourth-quarter deliveries below analyst estimates. The U.S. housing market has faced labor supply issues over the past several months, causing shortages of lumber and other raw materials along with a rise in construction costs, while demand for new homes has been rising. The sales of new U.S. single-family homes grew in July after three straight monthly declines, but housing market momentum is slowing as surging housing prices amid tight supply sideline some first-time buyers from the market. Further, Lennar flagged land supply chain challenges due to delays in permit approvals, and expects to deliver about 18,000 homes in the fourth quarter, compared with estimates of 20,343 homes, according to Refinitiv data. Orders, an indicator of future revenue, increased 4.6% to 16,277 homes in the third-quarter, while deliveries increased to 15,199 units from 13,842 units. The average price for homes delivered rose by 8% to $428,000. Overall, net earnings attributable to the company rose 111% to $1.41 billion, or $4.52 per share, in the quarter ended Aug. 31. The company has ended the third quarter with $2.6 billion in cash, no borrowings on the $2.5 billion revolver and a homebuilding debt to capital of 21.2%, an all-time Company low. The land lighter model resulted in incremental cash flow generation during the third quarter which the company used towards an early debt reduction of $300 million and the repurchase of about $250 million of the common stock.

LEN in the third quarter of FY 21 has reported the adjusted earnings per share of $3.27, beating the analysts’ estimates for the adjusted earnings per share of $3.24. The company had reported the adjusted revenue growth of 18.2 percent to $6.94 billion in the third quarter of FY 21, beating the analysts’ estimates for revenue of $6.87 billion.

Moreover, the revenues from home sales grew 19% in the third quarter of 2021 to $6.5 billion from $5.5 billion in the third quarter of 2020, primarily due to a 10% increase in the number of home deliveries and an 8% increase in the average sales price. The operating earnings for the Financial Services segment were $111.9 million in the third quarter of 2021, compared to $135.1 million in the third quarter of 2020.