Executive Summary
Lennar Corporation reported solid QQ3 2024 results, with revenue of $9.42 billion, up 7.9% year over year and 7.4% quarter over quarter. Despite a modest gross margin (approximately 15.6%), the company generated strong operating cash flow of $819 million and free cash flow of about $801 million, underpinning a robust liquidity position (cash and cash equivalents of roughly $4.31 billion) and a net cash position (net debt of about -$0.44 billion). Net income reached $1.16 billion, producing earnings per share (EPS) of $4.26, with a 2H2024 trajectory supported by disciplined cost management and favorable product mix. The balance sheet remains conservatively levered, with total liabilities of ~$12.18 billion and total stockholders’ equity of ~$27.41 billion, and liquidity metrics illustrating healthy coverage (current ratio ~11.5, quick ratio ~4.0, cash ratio ~1.50). The quarter also featured significant capital allocation activity, including a stock repurchase of ~$524.6 million, signaling confidence in intrinsic value and a commitment to returning capital to shareholders.
Key takeaway: Lennar’s QQ3 results reflect a resilient operating profile in a cyclical housing market, characterized by strong cash generation, prudent balance-sheet management, and value-focused capital allocation. Near-term execution hinges on housing demand dynamics, mortgage rate environment, and the efficiency of backlog conversion, all of which management will continue to monitor as it navigates a still-sensitive macro backdrop.
Key Performance Indicators
Key Insights
Revenue: $9.416B (+7.86% YoY; +7.42% QoQ). Gross profit: $1.472B; gross margin (based on reported gross profit and revenue) ~15.6%; Operating income: $1.308B (~13.89% margin); Net income: $1.162B (~12.34% net margin); EPS: $4.26 (YoY +10.08%; QoQ +23.48%).
Cash flow and liquidity: Operating cash flow $819.25M; capital expenditures $18.41M; free cash flow $800.84M; cash at period end $4.311B; net debt position roughly -$0.44B (net cash).
Balance sheet and leverage: Total assets $39.741B; to...
Financial Highlights
Revenue: $9.416B (+7.86% YoY; +7.42% QoQ). Gross profit: $1.472B; gross margin (based on reported gross profit and revenue) ~15.6%; Operating income: $1.308B (~13.89% margin); Net income: $1.162B (~12.34% net margin); EPS: $4.26 (YoY +10.08%; QoQ +23.48%).
Cash flow and liquidity: Operating cash flow $819.25M; capital expenditures $18.41M; free cash flow $800.84M; cash at period end $4.311B; net debt position roughly -$0.44B (net cash).
Balance sheet and leverage: Total assets $39.741B; total liabilities $12.184B; total stockholders’ equity $27.412B; debt to capital ~8.35%; current ratio 11.50; quick ratio 3.95; cash ratio 1.50. Shares repurchased: ~$524.6M.
Efficiency and working capital: DSO ~15.36 days; DIO ~252.98 days; inventory turnover 0.356x; receivables turnover 5.86x; payables turnover 4.11x; operating cash flow to sales ~0.087; capex coverage and other liquidity ratios indicate ample coverage for near-term obligations.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
9.42B |
7.86% |
7.42% |
| Gross Profit |
1.47B |
-8.18% |
5.51% |
| Operating Income |
1.31B |
-12.20% |
5.59% |
| Net Income |
1.16B |
4.84% |
21.83% |
| EPS |
4.26 |
10.08% |
23.48% |
Key Financial Ratios
operatingProfitMargin
13.9%
operatingCashFlowPerShare
$3.03
freeCashFlowPerShare
$2.96
dividendPayoutRatio
11.8%
Management Commentary
No earnings call transcript was provided in the input data. As a result, no verbatim management quotes or theme-specific highlights could be extracted from a transcript within this dataset.
Forward Guidance
Management did not publish explicit forward-looking targets in the supplied data. Given Lennar’s QQ3 2024 performance, the qualitative outlook hinges on housing demand momentum, mortgage-rate trajectory, and backlog conversion efficiency. Investors should monitor:
- Backlog levels and cancellation rates as leading indicators of future revenue.
- Land development cycles, input costs, and supply-chain resilience that affect construction costs and gross margin stability.
- Homebuyer demand in core geographies and product mix (entry-level vs. move-up/luxury) and how this influences margins and pricing power.
- Capital allocation cadence (ongoing buybacks vs. selective land/land development investments) and debt maturity profile.
Overall, the near-term earnings trajectory appears supported by strong liquidity and cash flow generation, with the key sensitivity remaining the housing market cycle and financing conditions.