Wang & Lee Group board approves 250-to-1 reverse share split
UBS lowered its price target on Lennar (NYSE:LEN) to $146.00 from $164.00 on Wednesday while maintaining a Buy rating on the homebuilder’s stock. Currently trading at $104.61 with a P/E ratio of 9.02, InvestingPro analysis suggests the stock is undervalued, with multiple indicators supporting this view.
The price target reduction follows Lennar’s fiscal second-quarter 2025 financial results, which UBS described as "challenging." The firm cited lower pricing due to elevated incentives and greater SG&A expenses from community count growth and continued technology investments as primary factors behind its revised forecast.
UBS reduced its fiscal year 2025 earnings per share estimate from $10.80 to $9.35, its fiscal 2026 estimate from $13.65 to $12.15, and its fiscal 2027 estimate from $16.50 to $15.20. The new price target is based on approximately 12 times the firm’s fiscal 2026 EPS estimate.
Despite the price target cut, UBS maintained its Buy rating on Lennar shares, stating it expects the company’s operating strategy "to bear fruit over time" and believes expectations have been reset to reflect near-term challenges of focusing on pace in a fluctuating demand environment. With a market capitalization of $27.48 billion and annual revenue of $35.37 billion, Lennar remains a significant player in the homebuilding sector. For deeper insights into Lennar’s valuation and growth prospects, access the comprehensive Pro Research Report available on InvestingPro.
UBS also expressed a broader view that sentiment has shifted "far too negatively" for homebuilders in general, noting the group is typically "among the first to bounce as a bottom approaches."
In other recent news, Lennar Corporation reported its second-quarter 2025 earnings, revealing a mixed performance. The company missed earnings per share (EPS) expectations, posting $1.90 against a projected $1.94, but exceeded revenue forecasts with $8.38 billion compared to an anticipated $8.18 billion. Despite the EPS miss, revenue growth was a positive indicator for the homebuilder. Citi and Oppenheimer have both maintained neutral ratings on Lennar, citing concerns over higher selling, general, and administrative expenses, particularly due to increased technology investments. Citi lowered its price target for Lennar from $118.00 to $117.00, reflecting a cautious outlook due to anticipated higher expenses and softer housing demand. Lennar’s management has guided a stable gross margin for the upcoming quarter, though selling expenses have been a point of concern for analysts. The company continues to focus on technology integration and operational efficiency, which has been a significant factor in its strategic planning. These developments highlight Lennar’s ongoing efforts to navigate a challenging housing market environment.
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