Lennar Corp., a major homebuilder with local offices and projects, announced a cut to its third quarter earnings estimate Friday, coinciding with my story about the building industry’s response to the cooling market.
That story reported the observation that Lennar employees now drink Folgers instant coffee in their break rooms, as opposed to Starbucks coffee a few months ago – a metaphor for the company’s belt-tightening in an uncertain housing market.
Looks like Folgers will be what’s on tap for a while longer, as the company alerted shareholders Friday that its earnings in the third quarter were much lower than Wall Street analysts had been anticipating. Here’s a story from the Wall Street Journal outlining the drop.
The Lennar CEO, Stuart Millar, said this in a statement:
The U.S. housing market has continued to deteriorate. … we experienced only a slight decline of 5% in preliminary net new orders for the quarter.
In the same vein, KB Home cut its earnings estimate for the whole year on Thursday, reporting a 43 percent year-on-year drop in orders. Click here for a blurb from MarketWatch about the cut.