Valuation Disconnect | Despite trading at a premium 1.5x forward tangible book versus peers at 1.4x, projected ROE of 7.9% raises questions about justified multiples |
Analyst Outlook | Price targets range from $88 to $96, with widespread downgrades reflecting concerns over execution risk and deteriorating returns on equity |
Strategic Gamble | The homebuilder transitions to a fully optioned land bank model, prioritizing volume over margins while navigating significant C-Suite departures |
Margin Crisis Unfolds | Lennar's gross margins plummet to 15-16%, the lowest since 2009, as strategic pivot to optioned land pressures profitability amid rising costs |
Metrics to compare | LEN | Sector Sector - Average of metrics from a broad group of related Consumer Cyclicals sector companies | Relationship RelationshipLENPeersSector | |
|---|---|---|---|---|
P/E Ratio | 12.5x | 11.0x | 10.5x | |
PEG Ratio | −0.27 | 0.08 | 0.02 | |
Price / Book | 0.9x | 1.3x | 1.4x | |
Price / LTM Sales | 0.6x | 0.7x | 0.9x | |
Upside (Analyst Target) | 1.8% | −2.4% | 27.2% | |
Fair Value Upside | Unlock | 22.1% | 11.6% | Unlock |
Lennar Corporation, together with its subsidiaries, operates as a homebuilder primarily under the Lennar brand in the United States. It operates through Homebuilding East, Homebuilding Central, Homebuilding South Central, Homebuilding West, Financial Services, Multifamily, and Lennar Other segments. The company’s homebuilding operations include the construction and sale of single-family attached and detached homes, as well as the purchase, development, and sale of residential land; and development, construction, and management of multifamily rental properties. It also offers residential mortgage financing, title insurance, and closing services for home buyers and others, as well as originating and selling securitization commercial mortgage loans. In addition, the company is involved in fund investment activities. It primarily serves first-time, move-up, active adult, and luxury homebuyers. The company was founded in 1954 and is based in Miami, Florida.