Analyst Boosts Q1 Orders Prediction For Lennar Corp., KB Home

Orders for new homes increased sharply in the first quarter at two major residential builders, an analyst said Wednesday. Deutsche Bank's Nishu Sood boosted his estimates to reflect "positive momentum in the first quarter as well as some possible deceleration due to weather." The analyst increased his forecast for order growth at Lennar Corp.

to 28 percent, from the 23 percent he previously predicted. Sood thinks KB Home's

orders will grow by 22 percent, up from his earlier forecast of 9 percent. Lennar is slated to post results on Thursday, while the far smaller KB expected the following day. Shares of both companies rose Wednesday afternoon in a broader market rally attributed to the Federal Reserve's plan to hold off on rate hikes until at least June. KB said recently that first-quarter orders through Feb. 9 were up 25 percent. KB is off more than 15 percent in the year to date and changed hands recently at $13.98, up $0.43. Lennar shares have gained about 10 percent this year, trading recently at $49.73, up $0.87. U.S. housing starts plunged 17% from a month earlier to a seasonally adjusted annual rate of 897,000 in February, the Commerce Department said Tuesday. Starts on single-family units, which exclude apartments and represent almost two-thirds of the market, dropped 14.9%. Multifamily units, including apartments and condominiums, fell 20.8%. New applications for building permits, a bellwether for construction in coming months, rose 3%. Economists surveyed by The Wall Street Journal had expected February housing starts to reach a rate of 1.04 million and permits to reach a rate of 1.06 million.