Evercore ISI Reiterates Outperform Rating on Lennar (LEN)

Evercore ISI analyst Stephen Kim reiterated an Outperform rating and $236.00 price target on Lennar (NYSE: LEN).

The analyst comments "This morning, LEN announced that it has entered into a definitive agreement to acquire Rausch Coleman Homes, a builder based in Arkansas, with additional operations in Alabama, the panhandle of FL, Kansas, Missouri, Oklahoma, and Texas. Rausch builds roughly 5k units annually and will expand LEN’s footprint into new and existing markets across the South and Midwest. We note that the addition of Rausch Coleman was anticipated in the company’s targeted 2025 growth of 10%+ that it provided on its 3Q24 earnings call, although we await more details related to purchase accounting, acquired backlog, and balance sheet impacts to be provided next month on the 4Q24 call. Thus, we are not changing our estimates at this time. While terms were not disclosed, we are inclined to view this acquisition positively, as it is consistent with our view that Lennar can drive meaningful growth through expansion into small markets that are less penetrated by other public builders. We note that the company also intends to grow into these markets in an asset-light manner by leveraging its relationships with its land banking partners."

For an analyst ratings summary and ratings history on Lennar click here. For more ratings news on Lennar click here.

Shares of Lennar closed at $167.92 yesterday.

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