(LEN-B) Lennar - Overview

Lennar Corporation (NYSE: LEN-B) is the largest homebuilder in the United States, headquartered in Miami, Florida. Founded in 1954, the firm sells single-family attached and detached homes, develops residential land, and operates multifamily rental assets. Its ancillary businesses include mortgage financing, title and closing services, and the origination and sale of commercial mortgage-backed securities.

The company is organized into seven reporting segments: Homebuilding East, Central, South-Central, and West; Financial Services; Multifamily; and Lennar Other. The homebuilding segments together account for roughly 85 % of total revenue, while Financial Services and Multifamily contribute the balance. Lennar targets a broad buyer spectrum-from first-time purchasers to luxury and active-adult customers-allowing it to capture demand across multiple price tiers.

In fiscal 2025 Lennar reported revenue of $27.5 billion, a 4.2 % year-over-year increase, and net income of $2.4 billion, reflecting a 6.8 % margin expansion driven by higher average selling prices (ASP) of $425 k (up 7 % YoY) and a backlog of approximately $45 billion. Home deliveries totaled 22,200 units, beating the company’s internal guidance but lagging the industry-wide 23,500-unit forecast from the National Association of Home Builders (NAHB). The Financial Services segment posted a net interest margin of 3.1 % despite a 0.25 percentage-point rise in average mortgage rates during the quarter.

Key macro drivers that will shape Lennar’s near-term outlook include: (1) **Mortgage rates**-the 30-year Treasury yield has hovered around 5.0 % since late 2024, pressuring affordability and potentially curbing first-time buyer activity; (2) **Housing inventory**-U.S. housing starts have risen 3 % YoY to 1.68 million units, but the supply-demand gap remains tight in high-growth metros, supporting price stability; and (3) **Labor and material costs**-construction labor indices are up 9 % year-to-date, while lumber and steel price volatility continues to affect margins. If rates retreat below 4.5 % or fiscal incentives for first-time buyers re-emerge, Lennar’s ASP growth could accelerate; conversely, a sustained high-rate environment would likely shift sales toward its higher-margin luxury and multifamily segments.

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