The Zacks Analyst Blog Highlights:Lennar, PulteGroup, Ryland Group, Meritage Homes and Starbucks
CHICAGO, Jan. 9, 2013 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog includeLennar Corporation (NYSE: LEN), PulteGroup, Inc. (NYSE: PHM), The Ryland Group, Inc. (NYSE: RYL), Meritage Homes Corporation (NYSE: MTH) and Starbucks Corporation (Nasdaq: SBUX).
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Here are highlights from Tuesday's Analyst Blog:
Lennar Hits New 52-Week High
One of the leading homebuilders in the U.S, Lennar Corporation (NYSE: LEN) reached a new 52-week high of $41.24 on January 07, 2013. Lennar carries a Zacks #2 Rank (Buy) for the near term.
Lennar is gaining momentum from the fast improving housing fundamentals. With housing recovery, there has been a drop in inventory levels and an increase in home prices.
Third Quarter 2012 Recap
Lennar Corporation reported adjusted earnings (excluding income tax adjustments) of 34 cents per share in the third quarter of fiscal 2012, beating the Zacks Consensus Estimate by 25.9%. Earnings also skyrocketed 209% from the prior-year quarter. Earnings growth was driven by improved homebuilding revenues and solid operating margins.
Total revenue in the quarter climbed 34% to $1.1 billion, driven by pricing and volume growth in a stabilizing housing market. Revenues also surpassed the Zacks Consensus Estimate of $1.03 billion.
Lennar has witnessed solid year-over-year growth in new home orders, average selling prices and home closings in all the three quarters of 2012. Margins have also been above average, despite rising costs, driven by strong operating leverage. Lennar appears confident of significant growth in the rest of the fiscal year and thereafter.
Lennar has delivered positive earnings surprises in all the quarters of 2012 with an impressive average earnings surprise of 27.4% in the trailing four quarters.
We believe that the company is performing better than its peers by increasing sales prices, reducing incentives, improving volumes and by making opportunistic land acquisitions. Moreover, Lennar's focus on the quality of communities instead of quantity also benefits its margins and new sales orders.
Other Stocks to Consider With the housing market recovering steadily, many other stocks in the homebuilding sector are currently performing well. These include PulteGroup, Inc. (NYSE: PHM) – Zacks #2 Rank (Buy), The Ryland Group, Inc. (NYSE: RYL) – Zacks #1 Rank (Strong Buy) and Meritage Homes Corporation (NYSE: MTH) – Zacks #2 Rank (Buy).
Starbucks Offers Mobile Card Readers
Starbucks Corporation (Nasdaq: SBUX) recently announced that as a part of its partnership with Square, Square Mobile Card Readers will now be available at its stores in the U.S. Enabled by its free software, Square Register, Square Mobile Card Readers will make credit card transactions easier and can be plugged into iPhone, iPad and Android devices.
In order to enable smooth credit and debit card transactions, Starbucks had entered into a partnership with Square in August 2012, a company that offers credit card readers for iPhone, iPad and Android devices. The Starbucks-Square partnership has already introduced the Pay with Square mobile application and the iPhone and Android Starbucks mobile payment applications. The partnership has allowed Starbucks customers to make quick payments at about 7,000 Starbucks stores.
Square Mobile Card Reader will serve small businesses by providing them with easy and affordable card processing services, thus liberating them from hassles associated with credit and debit card payments. Square Mobile Card Readers will significantly reduce the interchange fee associated with the use of debit and credit cards and enhance mobile payment services, thus encouraging business growth.
Starbucks connects with its consumers through its social, Internet, mobile, loyalty and cards programs. Starbucks confirmed that Starbucks cards are now used for 25% of the transactions in the U.S and the money loaded on the cards grew over 20%. The company expects 10% of the payments to be made using mobile application by the end of fiscal 2013.
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