Charticle: Backlog at Homebuilders

Homebuilder Lennar Corp. ($LEN) filed its latest quarterly report on Tuesday, giving us another opportunity to show the depth of non-financial metrics that Calcbench tracks, and which can be useful to financial analysts.

Our data point du jour: the backlog of homes Lennar is scheduled to build.


Lennar discloses that metric in its earnings release. For its most recent quarter, ending May 28, Lennar reported a backlog of 15,538 homes waiting to be built, with a total value of $6.5 billion.


From there, we simply used our See Tag History feature to chart Lennar’s quarterly backlog for the last several years. In less than two minutes, we ended up with Figure 1, below.



Fascinating, but also entirely predictable when you think about it. Demand for homes surged in the early 2020s while interest rates were at rock-bottom levels, but supply-chain disruptions thanks to the pandemic clogged construction operations at the same time. Hence we see that bulge in 2022, which Lennar has been working through ever since.


Figure 1, however, got us thinking — have other homebuilders seen a similar bulge and decline? 


So we ran the same exercise for KB Home ($KBH), and found that the answer is yes. See Figure 2, below, which took us another two minutes to compile.



KB Home is only about one-fifth the size of Lennar when measured by revenue: $6.9 billion in 2024 for KB compared to $35.4 billion for Lennar, and that ratio has held roughly steady for the last several years. 


Still, the bulge-and-decline pattern is clear for both firms. 


Analysts could posit a few questions from the data above. For example, while Lennar has a larger backlog, it seems to be burning through that backlog at a faster rate than KB Home. (Note the trend lines, where Lennar’s trend line clearly has a greater downward slope than KB Home’s.) 


So what’s the plan when backlog returns to some sort of “normal” amount? What is that normal amount, anyway, in today’s topsy-turvy housing market? The supply of housing in the United States is still several million units short, so will backlog continue? What if interest rates fall? What if they don’t? 


And so forth and so on. Calcbench doesn’t know the answer to these questions, but we do bring you the data so that you can ask them, and get better, more precise answers, more quickly.

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