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$11.40 -0.59 (-4.92%)
10/7/2008 11:16 AM

Lennar Corp (LEN)

CAPS Rating:
*

Primarily sell single-family attached and detached homes, and to a lesser extent, condominiums, in communities targeted to first-time, move-up and active adult homebuyers.

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Avatar TMFWBuffettJr (99.89) Submitted: 9/15/06 6:51 PM : Underperform Start Price: $44.57 LEN Score: 53.69

As with all home builders, you need to come to terms with whether you think they have dropped too far or we are just getting started. If you believe we still have room to fall, LEN is a weak position. It has operations in the worst bubble areas, including The company offers its services primarily in Arizona, California, Colorado, Florida, Maryland, Nevada, New York, and Virginia.

At 1.25, it's priced just slightly above the industry average of 1.2 times book value. I believe builders will continue to decline to book value, and some will fall well below book. On top of that, builders operating in bubble states may likely see their book values decline. At the very least, I expect this one to be outpaced byt the S&P 500.

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