UPDATE 4-Lennar Q2 loss widens; new home sales up sequentially

* Q2 loss $0.76/shr vs est $0.70/shr loss

* Rev down 21 pct

* New home deliveries up 47 pct vs Q1

* New orders up 63 pct vs Q1

* Shares up as much as 18 pct (Adds details, analysts' comments, share movement)

June 25 (Reuters) - U.S. homebuilder Lennar Corp (LEN.N) posted a wider year-over-year quarterly net loss, but saw a sequential rise in new home sales and orders, sending its shares up as much as 18 percent.

"During the second quarter, the housing market experienced a rise in sales of new homes, compared to the first quarter, as more confident homebuyers took advantage of increased affordability," Chief Executive Stuart Miller said in a statement.

Declining home prices, low interest rates and government stimulus programs have created opportunities for prospective homebuyers, he added.

"Relative to the first quarter it appears that overall market conditions continued to stabilize, albeit at extremely depressed levels," Raymond James analyst Buck Horne said in a note to clients.

Lennar's second-quarter new home deliveries rose 47 percent, while new orders were up 63 percent sequentially. Cancellation rate fell to 15 percent from 22 percent a year ago.

"While we are sensing pent-up demand in the market, rising unemployment, increased foreclosures and tighter credit standards continue to present challenges for the industry," CEO Miller noted.

This combined with a recent spike in mortgage rates has made it difficult to predict when the market will ultimately turn the corner, he added.

UNWINDING JOINT VENTURES

"While the company is exposed to a deteriorating housing market like other homebuilders, LEN faces the additional risks associated with potential liabilities arising from its joint venture investments," Citigroup analyst Josh Levin said, adding that the stock is mispriced at its current valuation

Early this year, the company came under fire for how it treated its joint ventures. Wall Street analysts have long lamented Lennar's extensive use of the joint venture land-buying structure, which requires a relatively low level of official disclosure.

With the company winding down its exposure to such investments, Levin expects the valuation discount to narrow. He has a "buy" rating, with a $12 price target on the stock.