| Abstract: | Our ratings on Lennar Corp. reflect this U.S. homebuilder's large net losses in recent quarters, weaker discretionary cash flow relative to leading competitors, and sizeable off-balance-sheet obligations. That said, Lennar's leverage remains in line with that of its peer group, even when adjusted for these off-balance-sheet obligations, and the company's cash holdings appear sufficient to fund near-term financial obligations. Miami-based Lennar is one of the nation's five largest homebuilders, having delivered 14,281 homes over the last four quarters at an average price of approximately $264,000. Adjusted gross margins on these sales (20%) were above those of its largest competitors (Pulte Homes Inc., Centex Corp., KB Home, and D.R. Horton Inc.) and Lennar's overhead costs were modestly lower (19%), which enabled
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