Lennar (NYSE:LEN) Given New $75.00 Price Target at Keefe, Bruyette & Woods

Key Points

• Keefe, Bruyette & Woods cut Lennar’s price target to $75 from $85 and maintained an “underperform” rating, implying roughly 8% downside from the prior close.
• Lennar’s latest quarter missed expectations, with EPS of $1.23 versus $1.29 expected and revenue of $8.05 billion versus $8.32 billion; revenue declined 8.7% year over year amid housing affordability pressures.
• Investor sentiment remains mixed: Berkshire Hathaway bought approximately $212.4 million of Lennar shares, while analysts’ consensus remains cautious, with an average “Reduce” rating and $81 price target.

Lennar (NYSE:LEN - Get Free Report) had its target price dropped by Keefe, Bruyette & Woods from $85.00 to $75.00 in a note issued to investors on Tuesday, Benzinga reports. The brokerage currently has an "underperform" rating on the construction company's stock. Keefe, Bruyette & Woods' price target points to a potential downside of 8.02% from the stock's previous close.

Other analysts have also issued reports about the stock. Benchmark upgraded shares of Lennar to a "hold" rating in a report on Thursday, September 3rd. The Goldman Sachs Group restated a "neutral" rating on shares of Lennar in a research report on Friday, June 5th. Bank of America reduced their price target on Lennar from $77.00 to $70.00 and set an "underperform" rating on the stock in a research note on Monday, September 14th. UBS Group dropped their target price on shares of Lennar from $107.00 to $94.00 and set a "neutral" rating on the stock in a report on Tuesday, June 16th. Finally, Truist Financial reduced their target price on shares of Lennar from $80.00 to $75.00 and set a "hold" rating on the stock in a research report on Wednesday, September 16th. One analyst has rated the stock with a Buy rating, seven have given a Hold rating and nine have given a Sell rating to the stock. Based on data from MarketBeat, the company has an average rating of "Reduce" and an average target price of $81.00.

Lennar Trading Up 4.4%

Shares of Lennar stock traded up $3.46 during midday trading on Tuesday, reaching $81.54. 2,306,153 shares of the company's stock traded hands, compared to its average volume of 2,970,460. The stock has a 50 day moving average of $84.05 and a 200-day moving average of $88.09. Lennar has a 12 month low of $75.70 and a 12 month high of $133.76. The company has a market cap of $19.64 billion, a PE ratio of 15.42, a price-to-earnings-growth ratio of 2.56 and a beta of 1.39. The company has a debt-to-equity ratio of 0.20, a quick ratio of 0.69 and a current ratio of 4.94.

Lennar (NYSE:LEN - Get Free Report) last issued its quarterly earnings data on Wednesday, September 16th. The construction company reported $1.23 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $1.29 by ($0.06). Lennar had a net margin of 4.09% and a return on equity of 6.15%. The company had revenue of $8.05 billion for the quarter, compared to analysts' expectations of $8.32 billion. During the same period in the previous year, the firm posted $2.29 earnings per share. The firm's revenue for the quarter was down 8.7% compared to the same quarter last year. As a group, equities analysts expect that Lennar will post 5.46 EPS for the current fiscal year.

Insider Activity

In other news, major shareholder Berkshire Hathaway Inc purchased 1,381,397 shares of the business's stock in a transaction dated Friday, September 18th. The shares were purchased at an average price of $76.48 per share, for a total transaction of $105,649,242.56. Following the completion of the acquisition, the insider directly owned 23,075,025 shares in the company, valued at $1,764,777,912. This represents a 6.37% increase in their position. The purchase was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Insiders have purchased a total of 2,743,529 shares of company stock valued at $212,403,202 in the last 90 days. Corporate insiders own 10.05% of the company's stock.

Institutional Inflows and Outflows

Several hedge funds have recently modified their holdings of LEN. MUFG Securities EMEA plc lifted its holdings in shares of Lennar by 2,522.7% during the 4th quarter. MUFG Securities EMEA plc now owns 114,245 shares of the construction company's stock valued at $11,744,000 after buying an additional 109,889 shares during the period. Element Capital Management LLC bought a new position in Lennar in the fourth quarter valued at about $6,437,000. Myriad Asset Management Advisors LLC bought a new stake in shares of Lennar during the 4th quarter valued at about $1,511,000. Cutler Investment Counsel LLC increased its position in shares of Lennar by 59.3% during the 4th quarter. Cutler Investment Counsel LLC now owns 42,464 shares of the construction company's stock valued at $4,365,000 after purchasing an additional 15,802 shares during the last quarter. Finally, Concurrent Investment Advisors LLC increased its position in shares of Lennar by 77.1% during the 2nd quarter. Concurrent Investment Advisors LLC now owns 89,178 shares of the construction company's stock valued at $8,070,000 after purchasing an additional 38,822 shares during the last quarter. Hedge funds and other institutional investors own 81.10% of the company's stock.

Lennar News Roundup

Here are the key news stories impacting Lennar this week:

• Positive Sentiment: Berkshire Hathaway bought approximately $212.4 million of Lennar stock. Berkshire purchased about 2.74 million shares across September 17, 18 and 21, raising its direct ownership to more than 10%. The investment is supporting sentiment by signaling that Berkshire considers Lennar’s depressed valuation attractive. Berkshire buys Lennar stock
• Positive Sentiment: Valuation is drawing investor interest. Lennar is trading near its 52-week low and below book value, which could offer downside support if housing conditions stabilize. The company also has relatively low leverage, with a debt-to-equity ratio of 0.20, and pays a quarterly dividend of $0.50 per share. Lennar below book value article
• Neutral Sentiment: Lennar acquired 444 lots near TSMC’s Phoenix-area project for $60 million. The land could benefit from future employment and population growth connected to the semiconductor investment, but the deal is unlikely to materially affect near-term earnings. Lennar Phoenix lots article
• Negative Sentiment: Third-quarter results missed expectations. Lennar reported EPS of $1.23 versus the $1.29 consensus and revenue of $8.05 billion versus estimates of $8.32 billion. Revenue fell 8.7% year over year, while a 15.8% gross margin reflected heavy incentives needed to offset affordability pressures. Lennar earnings and margins
• Negative Sentiment: Management cut its annual delivery forecast. Lennar now expects to deliver 80,000–81,000 homes, down from 82,000–83,000 previously, underscoring the impact of high mortgage rates and weak buyer affordability. Lennar delivery forecast
• Negative Sentiment: Citigroup lowered its price target to $85 from $88 and retained a neutral rating. The reduction reflects diminished earnings expectations following Lennar’s quarterly miss; broader analyst sentiment remains cautious. Citigroup Lennar price target

Lennar Company Profile

Lennar Corporation is one of the largest homebuilders in the United States. Founded in 1954 and headquartered in Miami, Florida, the company designs, constructs, and sells single-family homes and communities for a range of buyers, including first-time, move-up, and active-adult purchasers.

Lennar operates across many of the country's major housing markets, including communities in the West, Southwest, Southeast, Mid-Atlantic, and other metropolitan areas. Its homebuilding operations offer a variety of floor plans and home designs, while the company also develops residential communities and provides related services such as mortgage financing, title, and closing services through its financial-services businesses.

In addition to traditional homebuilding, Lennar has expanded into multifamily development and other residential real-estate activities.

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