What to look for when Lennar Corporation (LEN) reports Q1 2025 earnings | AlphaStreet

Shares of Lennar Corporation (NYSE: LEN) had been down 3% on Tuesday. The inventory has dropped 7% year-to-date. The homebuilder is scheduled to report its first quarter 2025 earnings outcomes on Thursday, March 20, after market shut. Right here’s a look at what to anticipate from the earnings report:

Income

Analysts are projecting income of $7.44 billion for Lennar in Q1 2025, indicating a rise of practically 2% from the primary quarter of 2024. Within the fourth quarter of 2024, income decreased 9% year-over-year to $9.9 billion.

Earnings

The consensus goal for Q1 2025 earnings per share is $1.72, which compares to EPS of $2.57 reported in Q1 2024. In This autumn 2024, adjusted EPS fell 22% YoY to $4.03.

Factors to observe

The housing market has been going through headwinds from inflation and excessive rates of interest, which have continued to strain affordability. Regardless of robust demand for housing, customers are reluctant to purchase new properties or transfer up to larger homes as households develop due to financial pressures. These tendencies might have continued within the first quarter of 2025, impacting the highest line.  

Financial headwinds, together with coverage adjustments and impacts from tariffs, are including to the uncertainty within the housing market. It stays to be seen if any reductions in rates of interest assist increase house gross sales.

Final quarter, Lennar fell wanting its expectations on new orders, which totaled 16,895 versus the projected 19,000. The corporate additionally noticed deliveries lower 7% YoY to 22,206 properties. For the primary quarter of 2025, LEN has guided for new orders within the vary of 17,500-18,000 and deliveries within the vary of 17,000-17,500.

So as to assist with affordability and drive gross sales, homebuilders have been providing worth changes and numerous incentives to consumers. This has pressured margins and it’s anticipated to proceed in Q1. In This autumn, Lennar noticed its common gross sales worth lower by over 2% to $430,000 due to greater incentives and product combine. Its gross margin was 22.1%, which got here beneath expectations of twenty-two.5%. The corporate expects common gross sales worth to vary between $410,000-415,000 and gross margin to be 19.0-19.25% in Q1 2025.