Lennar (NYSE:LEN) Stock Rated Sell in New Coverage at Melius Research

Key Points

• Melius Research initiated coverage of Lennar with a “sell” rating and a $72 price target, implying roughly 3.1% downside from the prior close. The broader analyst consensus is also strongly bearish, with 11 Sell, 7 Hold and 1 Buy rating.
• Lennar’s latest quarter showed continued housing-market pressure: EPS was $1.23 versus $1.29 expected, revenue fell 8.7% year over year to $8.05 billion, and the stock traded near its 52-week low.
• Berkshire Hathaway continued buying Lennar shares, purchasing 1.7 million shares worth about $136 million and increasing its stake by 6.39%. Institutional investors own approximately 81.1% of the company.

Melius Research assumed coverage on shares of Lennar (NYSE:LEN - Get Free Report) in a report released on Tuesday, Briefing.com reports. The brokerage set a "sell" rating and a $72.00 price target on the construction company's stock. Melius Research's price target would suggest a potential downside of 3.11% from the stock's previous close.

Other equities research analysts have also recently issued research reports about the stock. Royal Bank Of Canada dropped their price target on shares of Lennar from $85.00 to $69.00 and set an "underperform" rating for the company in a research report on Friday, September 18th. Citizens Jmp reaffirmed a "hold" rating on shares of Lennar in a research note on Thursday, September 17th. Benchmark raised Lennar to a "hold" rating in a research note on Thursday, September 3rd. Weiss Ratings reaffirmed a "sell (d+)" rating on shares of Lennar in a research report on Tuesday, September 8th. Finally, UBS Group cut their price objective on Lennar from $107.00 to $94.00 and set a "neutral" rating on the stock in a research report on Tuesday, June 16th. One investment analyst has rated the stock with a Buy rating, seven have given a Hold rating and eleven have issued a Sell rating to the company's stock. According to MarketBeat, the stock currently has a consensus rating of "Strong Sell" and a consensus price target of $79.33.

Lennar Trading Down 6.9%

Shares of LEN stock opened at $74.31 on Tuesday. The business has a 50-day moving average of $83.52 and a 200 day moving average of $86.85. The company has a debt-to-equity ratio of 0.20, a current ratio of 4.94 and a quick ratio of 0.69. Lennar has a 1-year low of $73.75 and a 1-year high of $133.76. The stock has a market capitalization of $17.90 billion, a PE ratio of 14.05, a P/E/G ratio of 3.00 and a beta of 1.36.

Lennar (NYSE:LEN - Get Free Report) last announced its quarterly earnings results on Wednesday, September 16th. The construction company reported $1.23 EPS for the quarter, missing analysts' consensus estimates of $1.29 by ($0.06). The company had revenue of $8.05 billion during the quarter, compared to analysts' expectations of $8.32 billion. Lennar had a return on equity of 6.15% and a net margin of 4.09%.Lennar's revenue for the quarter was down 8.7% on a year-over-year basis. During the same period last year, the firm earned $2.00 earnings per share. As a group, sell-side analysts anticipate that Lennar will post 4.87 earnings per share for the current year.

Insider Transactions at Lennar

In related news, major shareholder Berkshire Hathaway Inc purchased 1,708,095 shares of the stock in a transaction dated Friday, October 2nd. The stock was purchased at an average price of $79.44 per share, with a total value of $135,691,066.80. Following the transaction, the insider directly owned 28,438,045 shares in the company, valued at $2,259,118,294.80. This trade represents a 6.39% increase in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. Insiders acquired a total of 7,502,276 shares of company stock worth $595,303,287 in the last three months. 10.05% of the stock is currently owned by insiders.

Institutional Trading of Lennar

A number of institutional investors and hedge funds have recently bought and sold shares of the company. Polaris Financial Partners purchased a new position in shares of Lennar in the third quarter worth $27,000. Phillip James Consulting Co. bought a new stake in Lennar during the first quarter valued at about $30,000. Global Assets Advisory LLC purchased a new position in Lennar during the first quarter valued at approximately $39,000. Anchor Investment Management LLC boosted its holdings in Lennar by 1,276.4% in the 2nd quarter. Anchor Investment Management LLC now owns 757 shares of the construction company's stock worth $69,000 after buying an additional 702 shares during the period. Finally, Elevation Wealth Partners LLC grew its position in shares of Lennar by 1,272.4% during the second quarter. Elevation Wealth Partners LLC now owns 796 shares of the construction company's stock worth $72,000 after purchasing an additional 738 shares in the last quarter. 81.10% of the stock is currently owned by institutional investors.

Lennar News Roundup

Here are the key news stories impacting Lennar this week:

• Positive Sentiment: Berkshire Hathaway continued accumulating Lennar. Berkshire purchased approximately $190 million of Lennar shares across October 1 and 2, increasing its holdings to about 28.4 million shares, or roughly 12% of the homebuilder. The purchases may support investor confidence by signaling Berkshire’s belief that Lennar is undervalued despite near-term housing weakness. Berkshire Buys More Lennar Stock
• Neutral Sentiment: Legal investigations add headline risk. Block & Leviton is investigating potential securities-law violations involving Lennar, while Julie & Holleman is examining alleged misconduct related to Lennar’s dealings with Millrose Properties. The announcements are investigations, not findings of wrongdoing, but they could increase uncertainty for investors. Lennar Investor Investigation
• Negative Sentiment: Housing-market pressures are weighing on earnings. High mortgage rates, poor affordability, falling home prices and margin compression are hurting demand and profitability. Lennar’s latest quarterly earnings of $1.23 per share missed the $1.29 consensus estimate, while revenue declined 8.7% year over year to $8.05 billion. Lennar Housing Pressures
• Negative Sentiment: Analyst sentiment and recent coverage remain bearish. Several firms have reduced their price targets, and the consensus rating is “Reduce,” with more Sell ratings than Buy ratings. A negative report recently intensified selling, leaving Lennar below both its 50-day and 200-day moving averages and close to its 52-week low. Lennar Sets New 52-Week Low

Lennar Company Profile

Lennar Corporation NYSE: LEN is a homebuilding company that designs, constructs and sells single-family homes and, through its multifamily operations, develops apartment communities. Its residential offerings generally include homes across a range of sizes and prices, serving first-time, move-up and active-adult buyers.

The company also provides related services through businesses involved in mortgage financing, title and closing services, insurance and other real estate activities. Lennar develops residential communities and manages land acquisition, planning and construction as part of its integrated homebuilding model.

Founded in 1954, Lennar has expanded from its origins in South Florida into a national homebuilder serving numerous markets across the United States.

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