LEN - Embedded Expectations Analysis - 2018 02 06
ï€ Lennar Corporation (LEN:USA) currently trades at recent averages relative to UAFRS-based (Uniform) Earnings, with a 24.7x Uniform P/E. At these levels, market expectations are for constant Uniform ROA, and management has concerns about growth, volumes, and acquisitionsï€ Specifically, management may lack confidence in their progress towards closing and fully integrating WCI, and may have concerns about the adoption of their dynamic pricing tool throughout the firm. Furthermore, they may be exaggerating their enthusiasm regarding the CalAtlantic merger, and may lack confidence in the sustainability of earnings per share growth. Additionally, they may lack confidence in volume improvements throughout the year, and may be concerned about declines in multifamily community sizes
Lennar is a homebuilder in the United States, an originator of residential and commercial mortgage loans, a provider of title insurance and closing services and a developer of multifamily rental properties. The company's homebuilding operations include the construction and sale of single-family attached and detached homes as well as the purchase, development and sale of residential land directly and through unconsolidated entities in which it has investments. The company operates under the Lennar brand name. The company creates and participates in joint ventures that acquire and develop land for its homebuilding operations, for sale to third parties or for use in the ventures' own homebuilding operations.
In 2009, just as the dust was settling from the last major equity and credit market crises, we launched a boutique research firm with the intention of breaking Wall Street’s biases and broken incentives:
- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
- Stock analyst recommendations are not grounded in disciplined financial analysis
- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
- Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available
We sought to provide investors and company analysts with a source of information that changed all that.
Many years later, our business model remains because little has changed on Wall Street.
- Corporate credit ratings remain years behind the fundamental underpinnings of company performance
- Stock analysts continue to make recommendations with deeply inherent biases
- Research firms have failed to break down the walls between credit, equity, and macroeconomic research
- The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming
The integrity of Valens Research is founded in our disciplined processes and analytics. No “star” analysts. No corporate advisory relationships. No-nonsense opinions and recommendations.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.