Berkshire Hathaway Doubles Down on Housing Stock
Yahoo Finance ·
Berkshire Hathaway Doubles Down on Housing Stock Moz Farooque ACCA Tue, September 22, 2026 at 1:42 PM EDT 2 min read BRK-B LEN DHI This article first appeared on GuruFocus . Lennar ( NYSE:LEN ) shares rose after Berkshire Hathaway disclosed another $212.4 million purchase of the homebuilder, deepening a housing-sector bet that now sits against a much tougher operating backdrop. Berkshire already owns more than 10% of Lennar and had an existing stake worth roughly $1.2 billion, making the latest buying notable even as Lennar's earnings, orders and margins remain under pressure. Warning! GuruFocus has detected 6 Warning Signs with LEN. Is LEN fairly valued? Test your thesis with our free DCF calculator. According to an SEC Form 4, Berkshire bought more than 2.7 million Lennar Class A and Class B shares between September 17 and September 21 at weighted-average prices ranging from $74.80 to $79.41. The purchases were reported through Berkshire's insurance subsidiaries. The move also fits a broader housing push. Berkshire already owns D.R. Horton and completed its $6.8 billion acquisition of Taylor Morrison in July, increasing its exposure to U.S. residential construction even as affordability remains strained. That backdrop is important because Lennar's latest quarter showed clear pressure. Fiscal third-quarter earnings fell to $1.19 per share from $2.29 a year earlier and missed the $1.28 consensus estimate. Revenue dropped 8.6% to $8.05 billion, also below expectations. New orders declined 9% to 20,879 homes, deliveries slipped 3% to 20,840, and gross margin fell to 15.8% from 17.5% as Lennar relied on discounts and incentives to support demand. Management also cut its 2026 delivery outlook to 80,000-81,000 homes from 82,000-83,000. Berkshire's buying is a strong confidence signal, but it does not erase Lennar's near-term execution risk. Investors should watch gross margins, order growth, cancellation trends and the level of incentives needed to move homes. High mortgage rates and affordability remain the key macro constraints. The bull case strengthens if Lennar can stabilize orders without sacrificing further margin, while another guidance cut or deeper incentive spending would suggest Berkshire is buying into a recovery that may take longer to arrive.
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