Homebuilders rejoiced in 2020, but will the strength continue?
The surge in residential real estate has been one of the unexpected themes of 2020. Homebuilders have been posting strong results in the process, as millennials increasingly turn to remote work and ditch city centers for suburbs. One such homebuilder, Lennar, reported strong profits in Q4 as activity remained robust and as interest rates continue to anchor to record lows.
The question for investors is, will this housing strength continue? Or has the pandemic-induced wave of new homebuyers run its course, only to give way to softer activity in 2021? A.I.dvisor has some insight, with the analysis below comparing Lennar Corp., PulteGroup, and Toll Brothers.
he homebuilder reported higher profit in the fiscal fourth quarter as demand for homeownership remains elevated due to lower borrowing costs and the pandemic.According to our system of comparison, LEN is a better buy in the short-term than PHM and TOL.
LEN's MACD Histogram just turned positive
The Moving Average Convergence Divergence (MACD) for LEN turned positive on March 26, 2025. Looking at past instances where LEN's MACD turned positive, the stock continued to rise in of 53 cases over the following month. The odds of a continued upward trend are .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. of 57 cases where LEN's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .
The Momentum Indicator moved above the 0 level on March 27, 2025. You may want to consider a long position or call options on LEN as a result. In of 84 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where LEN advanced for three days, in of 314 cases, the price rose further within the following month. The odds of a continued upward trend are .
Bearish Trend Analysis
LEN moved below its 50-day moving average on March 07, 2025 date and that indicates a change from an upward trend to a downward trend.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where LEN declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
LEN broke above its upper Bollinger Band on March 06, 2025. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Aroon Indicator for LEN entered a downward trend on March 13, 2025. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 64, placing this stock slightly better than average.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.753) is normal, around the industry mean (7.196). P/E Ratio (11.784) is within average values for comparable stocks, (103.177). Projected Growth (PEG Ratio) (1.325) is also within normal values, averaging (1.437). LEN has a moderately low Dividend Yield (0.010) as compared to the industry average of (0.046). P/S Ratio (1.345) is also within normal values, averaging (88.859).
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating fairly steady price growth. LEN’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
Notable companies
Industry description
Market Cap
High and low price notable news
Volume
Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
General Information
a builder of residential buildings and provides residential mortgage, title and closing services
Industry Homebuilding