Lennar (LEN) Stock: Berkshire Hathaway Boosts Stake to 11% as Housing Slump Deepens

TLDR

• Berkshire Hathaway raised its Lennar stake to 11%, worth about $2.1 billion.
• Berkshire bought nearly 1.7 million shares from Wednesday through Friday at an average of $81 a share.
• Lennar stock is down about 20% year to date, one of the worst performers among major homebuilders.
• Q3 profit fell almost 50% to $1.19 a share as revenue dropped 9% to $8.05 billion.
• Wall Street holds a “Moderate Sell” consensus, with an average price target of $78.93.

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Lennar (LEN) stock traded near $82 on Friday, up slightly on the day but still down about 20% for the year. The move came after Berkshire Hathaway disclosed it now owns 11% of the homebuilder, a stake worth roughly $2.1 billion.

Lennar Corporation, LEN

Berkshire purchased nearly 1.7 million shares between Wednesday and Friday, paying an average of $81 apiece. That brought its total holding to close to 26 million shares.

The buying spree crossed a key threshold. Once Berkshire passed 10% ownership, it became legally required to report future trades within two business days instead of waiting for quarterly filings.

Warren Buffett’s company has been building this position for months. It nearly doubled its Lennar stake since the end of the second quarter alone.

The timing lines up with Lennar’s rough year. Shares started 2026 near $102 and have since fallen roughly 39% below their 52-week high of $133.76.

Mortgage rates hovering near 7% have kept many buyers away. Slower demand, lower selling prices, and heavier incentives have squeezed margins across the sector.

Why Berkshire Sees Value

Lennar trades below its book value of around $90 a share, making it a classic value play in a beaten-down group. The company’s average selling price came in near $372,000 per home last quarter.

Third-quarter profit told the story. Net income dropped to $284 million, or $1.19 per share, from $591 million a year earlier. Deliveries slipped 3% to 20,840 homes and new orders fell 9%.

Lennar trimmed its full-year delivery forecast to 80,000-81,000 homes, down from an earlier range of 82,000-83,000. Home-sales gross margin also slid, to 15.8% from 17.5%.

There’s a silver lining buried in the numbers. Lennar’s construction costs per square foot fell 6% year-over-year, and build times hit a record 116 days.

The company also keeps its land exposure light, owning less than 2.5% of its roughly 488,000 controlled homesites. Its arrangement with Millrose Properties helps fund land purchases without tying up as much of Lennar’s own cash.

What Comes Next

Analysts expect Lennar’s fourth-quarter earnings, due Dec. 15, to fall 29% year-over-year to $1.45 per share. Full-year EPS is projected to drop 40% to $4.85.

Wall Street isn’t rushing to defend the stock despite Berkshire’s confidence. Bank of America kept its “Underperform” rating and cut its price target to $70 from $77.

Wells Fargo trimmed its target to $80 from $85 while holding an “Equal-Weight” rating. Truist lowered its target to $80 from $90 under a “Hold” rating.

The stock now carries a consensus “Moderate Sell” rating. The average analyst price target of $78.93 implies about 3% downside from current levels.

Berkshire’s buying is likely being driven by investment manager Ted Weschler, who oversees a slice of the firm’s $350 billion equity portfolio. The firm already owns Taylor Morrison and Clayton Homes, giving it deep exposure to housing.

Lennar remains controlled by the Miller family through super-voting shares, a structure that would complicate any future takeover talk.