Lennar Corporation (NYSE:LEN) stock rose 3.20% (As on June 22, 11:14:28 AM UTC-4,Source: Google Finance) after the company’s fiscal second-quarter results beat expectations. However, the company’s executive chairman commented on the uncertainty in the housing market in the face by saying that third-quarter guidance was closer to “guessing” than “guiding.” Revenues from home sales increased 33% in the second quarter of 2022 to $8.0 billion from $6.0 billion in the second quarter of 2021. Revenues were higher primarily due to a 14% increase in the number of home deliveries to 16,549 homes from 14,493 homes and a 17% increase in the average sales price to $483,000 from $414,000. Gross margin on home sales were $2.4 billion, or 29.5%, in the second quarter of 2022, compared to $1.6 billion, or 26.1%, in the second quarter of 2021. During the second quarter of 2022, an increase in revenues per square foot was offset by an increase in costs per square foot primarily due to higher material and labor costs. Overall, gross margins improved year over year as land costs remained relatively flat while interest expense decreased as a result of the Company’s focus on reducing debt. Operating earnings for the Financial Services segment were $103.9 million in the second quarter of 2022, compared to $121.3 million in the second quarter of 2021. The decrease in operating earnings was primarily due to lower mortgage net margins driven by a more competitive mortgage market, partially offset by an increase in rate lock volume and an increase in profit per order in the title business.
LEN in the second quarter of FY 22 has reported the adjusted earnings per share of $4.49, beating the analysts’ estimates for the adjusted earnings per share of $3.96, according to analysts surveyed by Refinitiv. The company had reported the adjusted revenue growth of 30 percent to $8.36 billion in the second quarter of FY 22, beating the analysts’ estimates for revenue of $8.08 billion. New orders increased 4% to 17,792 homes; new orders dollar value increased 20% to $9.1 billion. Backlog increased 16% to 28,624 homes; backlog dollar value increased 33% to $14.7 billion.
Additionally, during the second quarter of 2022, the Company repurchased 4.1 million shares of its common stock for $320.6 million at an average per share price of $78.20. At May 31, 2022, the Company had $1.3 billion of Homebuilding cash and cash equivalents and no borrowings under its $2.575 billion revolving credit facility, thereby providing $3.9 billion of available capacity.