NEW YORK (Reuters) - Lennar Corp., the nation's No. 3 home builder, reported quarterly earnings Tuesday that rose 42 percent, blowing past analysts' expectations and prompting the company to raise its outlook for the year.

For the fiscal third quarter ended Aug. 31, 2003, the Miami-based Lennar (LEN: Research, Estimates) said it earned $201 million, or $2.43 per diluted share, compared with $142.2 million, or $1.83 per diluted share, in the same period in 2002. 

Analysts on average had expected the company to earn $2.23 a share in the third quarter, with 11 estimates ranging from $2.14 to $2.40 a share, according to Reuters Research. 

Meanwhile KB Home <> (KBH: Research, Estimates), a builder of homes for first- and second-time home-buyers, reported quarterly earnings that rose 17 percent, buoyed by continued strong demand for housing and the company's recent acquisitions. 

For the fiscal third quarter ended Aug. 31, the Los Angeles-based KB Home earned $97.8 million, or $2.33 a share, compared with $83.9 million, or $1.95 a share, in the year-ago quarter. 

Analysts surveyed by Reuters Research had expected the company to earn $2.14 a share, with 12 estimates ranging from $1.98 to $2.30 a share.