The stock deal will give CalAtlantic shareholders 0.885 shares of Lennar stock, with an implied value of $51.34 per share, a 27 percent premium to CalAtlantic's closing price on Friday. The stock has been on an upward trend for over a month and has surged to a new high for the year. (NYSE:CAA). At the time of writing, the First Call consensus price target for the company is $40.25.
Shares of CalAtlantic Group (NYSE:CAA) opened at 40.45 on Thursday. For the past 5 years, the company's revenue has grown 48.6%, while the company's earnings per share has grown 75.8%.
Miller and his family trust, which hold a 41.4 percent voting interest in Lennar, and MP CA Homes, an affiliate of MatlinPatterson Global Opportunities Partners that holds a 25.4 percent voting interest in CalAtlantic, have agreed to support the deal, the companies said. Prudential Financial Inc. now owns 45,137 shares of the construction company's stock valued at $1,690,000 after buying an additional 2,210 shares during the last quarter. The company has a market cap of $4.46 billion, a price-to-earnings ratio of 11.13 and a beta of 1.42. For the quarter, shares have been noted at 15.24%.
CalAtlantic Group Inc and Lennar Corporation are expecting synergies between the two companies once the acquisition is complete. CalAtlantic Group's quarterly revenue was up 4.0% on a year-over-year basis. During the same quarter in the previous year, the company earned $0.83 earnings per share.
In other CalAtlantic Group news, CEO Larry T. Nicholson sold 17,033 shares of the stock in a transaction dated Tuesday, September 26th. On average, analysts predict that CalAtlantic Group will post $3.45 EPS for the current fiscal year. The shares were sold at an average price of $36.00, for a total transaction of $613,188.00.
Lennar shares were trading early this afternoon at $55.84, down 2.17, or 3.7 percent. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Fifth Third Bancorp bought a new stake in shares of CalAtlantic Group during the second quarter valued at approximately $166,000.
The deal will close in the first quarter of 2018. The day began at US$40.22 but the price moved to US$39.72 at one point during the trading and finally capitulating to a session high of US$40.6. Riverhead Capital Management LLC grew its position in CalAtlantic Group by 71.4% in the second quarter.