Berkshire Raises Lennar Stake to Nearly 12% Amid Homebuilder Rout

Yahoo Finance··US·Read original
3▲1 ▼1Impact / 5
Summary · why it matters

Berkshire Hathaway has raised its stake in homebuilder Lennar, now owning nearly 12% of the company. The increased position comes as Lennar shares have hit a recent low following a Hunterbrook report questioning the company's financing arrangements with Millrose Properties, a REIT it once owned. According to Hunterbrook, Lennar sold over 700 homes to Millrose, which rents them out, and Millrose appeared to pay more than market rate for those homes. The report also suggested Lennar looked set to miss a target for homes sold before Millrose bought a couple hundred homes right before the end of the quarter, pushing Lennar over its number. Millrose was originally created to buy land rather than homes, but changed its rules in August to allow home purchases, and it was recently downgraded by an analyst at Citizens who raised questions about the business model. Lennar is the second biggest home builder in the US, and the Berkshire investment is being viewed as a vote of confidence in the company or a sign it sees value in the stock.

Impact on assets 4

Energy Transition & Power Demand▲ · 1 stocks
Consumer Discretionary▲ · 1 stocks
Lennar Corporation
LEN
± MixedRegulationrelevance

Hunterbrook report questions Lennar's financing arrangements and quarter-end home sales to Millrose, while Berkshire's stake is a vote of confidence.

Real Estate▼ · 1 stocks
Millrose Properties, Inc.
MRP
▼ NegativeCapitalrelevance

Citizens downgraded Millrose and questioned its business model after it paid above market for Lennar homes.

Financials▲ · 1 stocks
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