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LEN (Lennar) Graham Number : $172.21 (As of Aug. 2024)


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What is Lennar Graham Number?

Graham Number is a figure that measures a stock's fundamental value by taking into account the company's earnings per share and book value per share. The Graham number is the upper bound of the price range that a defensive investor should pay for the stock. According to the theory, any stock price below the Graham number is considered undervalued, and thus worth investing in.

As of today (2024-10-31), the stock price of Lennar is $170.30. Lennar's graham number for the quarter that ended in Aug. 2024 was $172.21. Therefore, Lennar's Price to Graham Number ratio for today is 0.99.

The historical rank and industry rank for Lennar's Graham Number or its related term are showing as below:

LEN' s Price-to-Graham-Number Range Over the Past 10 Years
Min: 0.49   Med: 0.9   Max: 1.26
Current: 0.99

During the past 13 years, the highest Price to Graham Number ratio of Lennar was 1.26. The lowest was 0.49. And the median was 0.90.

LEN's Price-to-Graham-Number is ranked worse than
50.62% of 81 companies
in the Homebuilding & Construction industry
Industry Median: 1 vs LEN: 0.99

Graham Number is a combination of asset valuation and earnings power valuation. It is a very conservative way of valuing a stock.


Lennar Graham Number Historical Data

The historical data trend for Lennar's Graham Number can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Lennar Graham Number Chart

Lennar Annual Data
Trend Nov14 Nov15 Nov16 Nov17 Nov18 Nov19 Nov20 Nov21 Nov22 Nov23
Graham Number
Get a 7-Day Free Trial Premium Member Only Premium Member Only 70.89 89.17 129.54 166.59 159.63

Lennar Quarterly Data
Nov19 Feb20 May20 Aug20 Nov20 Feb21 May21 Aug21 Nov21 Feb22 May22 Aug22 Nov22 Feb23 May23 Aug23 Nov23 Feb24 May24 Aug24
Graham Number Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 156.14 161.21 164.83 169.27 172.21

Competitive Comparison of Lennar's Graham Number

For the Residential Construction subindustry, Lennar's Price-to-Graham-Number, along with its competitors' market caps and Price-to-Graham-Number data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Lennar's Price-to-Graham-Number Distribution in the Homebuilding & Construction Industry

For the Homebuilding & Construction industry and Consumer Cyclical sector, Lennar's Price-to-Graham-Number distribution charts can be found below:

* The bar in red indicates where Lennar's Price-to-Graham-Number falls into.



Lennar Graham Number Calculation

Graham Number is a concept based on Ben Graham's conservative valuation of companies.

Lennar's Graham Number for the fiscal year that ended in Nov. 2023 is calculated as

Graham Number
=sqrt of (22.5* Tangible Book per Share *EPS without NRI)
=sqrt of (22.5*81.683*13.865)
=159.63

Lennar's Graham Number for the quarter that ended in Aug. 2024 is calculated as

Graham Number
=sqrt of (22.5*Tangible Book per Share*EPS without NRI (TTM))
=sqrt of (22.5*87.672*15.034)
=172.21

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Lennar  (NYSE:LEN) Graham Number Explanation

Ben Graham actually did not publish a formula like this. But he wrote in The Intelligent Investor (1948 version) regarding to the criteria for purchases:

Current price should not be more than 15 times average earnings of the past three years.

Current price should not be more than 1.5 times the book value last reported. However, a multiplier of earnings below 15 could justify a correspondingly higher multiplier of assets. As a rule of thumb we suggest that the product of the multiplier times the ratio of price to book value should not exceed 22.5. (This figure corresponds to 15 times earnings and 1.5 times book value. It would admit an issue selling at only 9 times earnings and 2.5 times asset value, etc.)

Unlike valuation methods such as DCF or Discounted Earnings, the Graham number does not take growth into the valuation. Unlike the valuation methods based on book value alone, it takes into account the earnings power. Therefore, the Graham Number is a combination of asset valuation and earnings power valuation.

In general, the Graham number is a very conservative way of valuing a stock. It cannot be applied to companies with negative book values.

Lennar's Price to Graham number Ratio for today is calculated as

Price to Graham number=Share Price (Today)/Graham number (Q: Aug. 2024 )
=170.30/172.21
=0.99

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Be Aware

Please keep these in mind:

1. Graham Number does not take growth into account. Therefore it underestimates the values of the companies that have good earnings growth. We feel that if the earnings per share grows more than 10% a year, Graham Number underestimates the value.
2. Graham Number punishes the companies that have temporarily low earnings. Therefore, an average of earnings makes more sense in the calculation of Graham Number.
3. Graham Numbers underestimates companies that are light with book.


Lennar Graham Number Related Terms

Thank you for viewing the detailed overview of Lennar's Graham Number provided by GuruFocus.com. Please click on the following links to see related term pages.


Lennar Business Description

Address
5505 Waterford District Drive, Miami, FL, USA, 33126
Lennar is one of the largest public homebuilders in the United States. The company's homebuilding operations target first-time, move-up, and active adult homebuyers mainly under the Lennar brand name. Lennar's financial-services segment provides mortgage financing and related services to its homebuyers. Miami-based Lennar is also involved in multifamily and single-family for rent construction and has invested in numerous housing-related technology startups.
Executives
Amy Banse director 345 PARK AVENUE, SAN JOSE CA 95110
Diane J Bessette officer: VP/CFO/Treasurer LENNAR CORPORATION, 700 NW 107 AVE 4TH FLR, MIAMI FL 33172
Mark Sustana officer: VP/General Counsel/Secretary LENNAR CORPORATION, 700 NW 107 AVE 4TH FLR, MIAMI FL 33172
David M Collins officer: VP & Controller LENNAR CORPORATION, 700 NW 107 AVENUE STE 400, MIAMI FL 33172
Jeffrey Joseph Mccall officer: Executive Vice President 26 TECHNOLOGY DRIVE, IRVINE CA 92618
Dacona Smith director 5505 BLUE LAGOON DRIVE, MIAMI FL 33126
Serena Wolfe director ANNALY CAPITAL MANAGEMENT, INC., 1211 AVE. OF THE AMERICAS, NEW YORK NY 10036
Jonathan M Jaffe director, officer: Vice President LENNAR CORPORATION, 700 NW 107 AVE 4TH FLR, MIAMI FL 33172
Scott D Stowell director
Irving Bolotin director LENNAR CORPORATION, 700 NW 107 AVE 4TH FLR, MIAMI FL 33172
Steven L Gerard director P.O. BOX 554, MILWAUKEE WI 53201-0554
Armando J Olivera director C/O FLUOR CORPORATION, 6700 LAS COLINAS BLVD, IRVING TX 75039
Sherrill W Hudson director 201 SOUTH BISCAYNE BOULEVARD, 34TH FLOOR, MIAMI CENTER, MIAMI FL 33131
Jeffrey Sonnenfeld director 14 WALL ST 13TH FL, NEW YORK NY 10005
Theron I Gilliam director GMS INC., 100 CRESCENT CENTRE PARKWAY, SUITE 800, TUCKER GA 30084