Lennar (NYSE:LEN) Stock Sees Heavy Put Option Buying

Key Points

• Put-option activity surged: Investors purchased 10,175 Lennar put options, about 31% above the stock’s average daily put volume, signaling heightened bearish or hedging interest.
• Insider buying continued: Berkshire Hathaway bought 642,821 shares for approximately $52.4 million, while insiders purchased more than 5 million shares over the past 90 days.
• Fundamentals and analyst sentiment remain weak: Lennar missed quarterly earnings and revenue estimates, with revenue down 8.7% year over year. Analysts’ average rating is “Reduce,” with an average price target of $79.86 versus the reported share price of $80.15.

Lennar Corporation (NYSE:LEN - Get Free Report) was the target of unusually large options trading activity on Friday. Stock investors acquired 10,175 put options on the stock. This represents an increase of approximately 31% compared to the average daily volume of 7,770 put options.

Insider Transactions at Lennar

In other Lennar news, major shareholder Berkshire Hathaway Inc bought 642,821 shares of the firm's stock in a transaction on Wednesday, September 30th. The shares were purchased at an average price of $81.58 per share, for a total transaction of $52,441,337.18. Following the transaction, the insider directly owned 26,034,436 shares in the company, valued at approximately $2,123,889,288.88. This trade represents a 2.53% increase in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Over the last ninety days, insiders have bought 5,083,639 shares of company stock valued at $402,669,384. Insiders own 10.05% of the company's stock.

Hedge Funds Weigh In On Lennar

Hedge funds have recently modified their holdings of the business. Anchor Investment Management LLC lifted its holdings in Lennar by 1,276.4% during 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. Sequoia Financial Advisors LLC increased its stake in shares of Lennar by 5.3% in the second quarter. Sequoia Financial Advisors LLC now owns 14,609 shares of the construction company's stock valued at $1,322,000 after buying an additional 735 shares during the period. Van Hulzen Asset Management LLC acquired a new position in shares of Lennar in the second quarter worth approximately $317,000. Cidel Asset Management Inc. lifted its stake in shares of Lennar by 15.6% in the second quarter. Cidel Asset Management Inc. now owns 4,873 shares of the construction company's stock worth $441,000 after acquiring an additional 657 shares during the period. Finally, Pinnacle Wealth Management Advisory Group LLC bought a new stake in Lennar in the second quarter valued at approximately $232,000. Institutional investors and hedge funds own 81.10% of the company's stock.

Lennar Price Performance

Shares of NYSE LEN traded down $1.96 during midday trading on Friday, reaching $80.15. 4,263,999 shares of the company were exchanged, compared to its average volume of 3,092,594. The stock's 50-day moving average price is $83.83 and its 200-day moving average price is $87.12. The stock has a market cap of $19.31 billion, a P/E ratio of 15.20, a PEG ratio of 3.08 and a beta of 1.36. The company has a quick ratio of 0.69, a current ratio of 4.94 and a debt-to-equity ratio of 0.20. Lennar has a one year low of $75.70 and a one year high of $133.76.

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). Lennar had a net margin of 4.09% and a return on equity of 6.15%. The firm had revenue of $8.05 billion for the quarter, compared to analyst estimates of $8.32 billion. During the same period in the previous year, the business posted $2.29 earnings per share. The business's revenue for the quarter was down 8.7% compared to the same quarter last year. On average, sell-side analysts anticipate that Lennar will post 4.85 earnings per share for the current fiscal year.

Lennar Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Thursday, October 22nd. Shareholders of record on Wednesday, October 7th will be issued a dividend of $0.50 per share. This represents a $2.00 dividend on an annualized basis and a yield of 2.5%. The ex-dividend date of this dividend is Wednesday, October 7th. Lennar's payout ratio is presently 37.81%.

Analyst Ratings Changes

A number of equities analysts have commented on LEN shares. BTIG Research restated a "sell" rating and set a $63.00 price objective on shares of Lennar in a research note on Friday, September 18th. Keefe, Bruyette & Woods reduced their target price on Lennar from $85.00 to $75.00 and set an "underperform" rating on the stock in a report on Tuesday, September 22nd. Evercore raised their price target on Lennar from $82.00 to $87.00 and gave the stock an "underperform" rating in a research report on Monday, June 15th. Royal Bank Of Canada dropped their price target on Lennar from $85.00 to $69.00 and set an "underperform" rating for the company in a research note on Friday, September 18th. Finally, Benchmark raised shares of Lennar to a "hold" rating in a research report on Thursday, September 3rd. One equities research analyst has rated the stock with a Buy rating, seven have given a Hold rating and ten have assigned a Sell rating to the company. Based on data from MarketBeat.com, the stock currently has an average rating of "Reduce" and an average target price of $79.86.

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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