Lennar Corp stock prediction after announcing mixed FQ4 results

By:
on Dec 17, 2021
  • Lennar Corp shares on Thursday declined by more than 4% after reporting FQ4 results.
  • The company announced its most recent quarterly results Wednesday after the close beating earning estimate.
  • However, its quarterly revenue failed to match Street expectations.

On Thursday, Lennar Corp (NYSE:LEN) shares fell by more than 4% after announcing its most recent quarterly results. The company reported its fiscal fourth-quarter results Wednesday after markets closed, beating the consensus for analyst expectations. However, Lennar’s quarterly revenue failed to meet analyst expectations despite posting significant growth.

The company posted FQ4 non-GAAP earnings per share of $4.36, beating the average analyst estimate of $4.15. On the other hand, its GAAP EPS of $3.91, fell short of the Street expectation of $4.14, while revenue for the quarter increased by 23.4% from the same quarter last year to $8.43 billion, $80 million below expectations.

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Lennar looks undervalued

From an investment perspective, Lennar shares trade at compelling trailing 12-month and forward P/E ratios of 8.20 and 7.47, respectively. Therefore, shares of the Miami, Florida-based home builder could be an attractive option for bargain hunters.

In addition, analysts expect Lennar’s bottom line to grow by nearly 37% this year before improving at an annual rate of about 10.70% over the next five years. Therefore, Lennar could also gain the interest of growth investors.

Although Lennar shares have pulled back more than 7% since the 10th of December, the stock is still up more than 46% this year.

Source – TradingView

Technically, Lennar shares seem to have recently pulled back to complete a downward breakout from an ascending channel formation. As a result, the stock has fully recovered from overbought conditions.

Therefore, investors could target extended pullbacks at about $103.42, or lower at $98.99. However, given the company’s exciting valuation, Lennar shares could bounce back, rallying towards $113.24 or higher to $117.35.

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