Lennar Corporation (NYSE:LEN) Might Not Be As Mispriced As It Looks
Lennar Corporation (NYSE:LEN) Might Not Be As Mispriced As It Looks
Lennar Corporation's (NYSE:LEN) price-to-earnings (or "P/E") ratio of 10.4x might make it look like a buy right now compared to the market in the United States, where around half of the companies have P/E ratios above 17x and even P/E's above 32x are quite common. However, the P/E might be low for a reason and it requires further investigation to determine if it's justified.
Lennar has been struggling lately as its earnings have declined faster than most other companies. It seems that many are expecting the dismal earnings performance to persist, which has repressed the P/E. You'd much rather the company wasn't bleeding earnings if you still believe in the business. Or at the very least, you'd be hoping the earnings slide doesn't get any worse if your plan is to pick up some stock while it's out of favour.
Want the full picture on analyst estimates for the company? Then our free report on Lennar will help you uncover what's on the horizon.Is There Any Growth For Lennar?
There's an inherent assumption that a company should underperform the market for P/E ratios like Lennar's to be considered reasonable.
Retrospectively, the last year delivered a frustrating 12% decrease to the company's bottom line. Even so, admirably EPS has lifted 47% in aggregate from three years ago, notwithstanding the last 12 months. Although it's been a bumpy ride, it's still fair to say the earnings growth recently has been more than adequate for the company.
Turning to the outlook, the next three years should generate growth of 11% per annum as estimated by the analysts watching the company. That's shaping up to be similar to the 11% per annum growth forecast for the broader market.
In light of this, it's peculiar that Lennar's P/E sits below the majority of other companies. Apparently some shareholders are doubtful of the forecasts and have been accepting lower selling prices.
The Final Word
Typically, we'd caution against reading too much into price-to-earnings ratios when settling on investment decisions, though it can reveal plenty about what other market participants think about the company.
Our examination of Lennar's analyst forecasts revealed that its market-matching earnings outlook isn't contributing to its P/E as much as we would have predicted. There could be some unobserved threats to earnings preventing the P/E ratio from matching the outlook. It appears some are indeed anticipating earnings instability, because these conditions should normally provide more support to the share price.
A lot of potential risks can sit within a company's balance sheet. You can assess many of the main risks through our free balance sheet analysis for Lennar with six simple checks.
If these risks are making you reconsider your opinion on Lennar, explore our interactive list of high quality stocks to get an idea of what else is out there.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Lennar Corporation(紐約證券交易所代碼:LEN)市盈率(或 “市盈率”)爲10.4倍,與美國市場相比,目前可能看起來像買入。美國約有一半公司的市盈率高於17倍,甚至市盈率高於32倍也很常見。但是,市盈率之低可能是有原因的,需要進一步調查以確定其是否合理。
Lennar最近一直在苦苦掙扎,因爲其收益下降速度快於大多數其他公司。看來許多人預計慘淡的盈利表現將持續下去,這抑制了市盈率。如果你仍然相信該業務,你寧願公司不流失收益。或者至少,如果你的計劃是在失寵的時候買入一些股票,你希望收益下滑不會變得更糟。
想全面了解分析師對公司的估計嗎?然後,我們關於Lennar的免費報告將幫助您發現即將發生的事情。Lennar 有增長嗎?
人們固有的假設是,如果像倫納爾這樣的市盈率才算合理,公司的表現應該低於市場。
回顧過去,去年該公司的利潤下降了12%,令人沮喪。即便如此,儘管過去12個月,但每股收益仍比三年前增長了47%,令人欽佩。儘管這是一個坎坷的旅程,但可以公平地說,最近的收益增長對公司來說已經足夠了。
展望來看,根據關注該公司的分析師的估計,未來三年將實現每年11%的增長。這將與整個市場每年11%的增長預測相似。
有鑑於此,奇怪的是,倫納爾的市盈率低於大多數其他公司。顯然,一些股東對預測表示懷疑,並一直在接受較低的銷售價格。
最後一句話
通常,在做出投資決策時,我們會謹慎行事,不要過多地閱讀市盈率,儘管這可以充分揭示其他市場參與者對公司的看法。
我們對Lennar分析師預測的研究表明,其與市場匹配的收益前景對市盈率的貢獻不如我們預期的那麼大。可能存在一些未觀察到的收益威脅,使市盈率與前景不符。看來有些人確實在預測收益不穩定,因爲這些條件通常應該爲股價提供更多支撐。
公司的資產負債表中可能存在許多潛在風險。您可以通過我們對Lennar的免費資產負債表分析,通過六張簡單的支票來評估許多主要風險。
如果這些風險讓你重新考慮你對Lennar的看法,請瀏覽我們的高質量股票互動清單,了解還有什麼。
對這篇文章有反饋嗎?對內容感到擔憂?直接聯繫我們。 或者,給編輯團隊 (at) simplywallst.com 發送電子郵件。
Simply Wall St的這篇文章本質上是籠統的。我們僅使用公正的方法根據歷史數據和分析師的預測提供評論,我們的文章無意作爲財務建議。它不構成買入或賣出任何股票的建議,也沒有考慮到您的目標或財務狀況。我們的目標是爲您提供由基本數據驅動的長期重點分析。請注意,我們的分析可能不考慮最新的價格敏感型公司公告或定性材料。簡而言之,華爾街沒有持有任何上述股票的頭寸。
譯文內容由第三人軟體翻譯。
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