TLDR
- Warren Buffett’s Berkshire Hathaway purchased an additional $192.6 million in Lennar shares on October 1-2, 2026.
- The investment firm’s stake has grown to approximately 12% of the homebuilder, valued at $2.2 billion.
- Shares of LEN tumbled 7% to $74.44 on Monday, marking a fresh 52-week low.
- The decline followed a Hunterbrook investigative report raising concerns about Lennar’s transactions with Millrose Properties.
- The homebuilder’s fiscal third-quarter results fell short of analyst expectations for both earnings and revenue.
Lennar stock finished Monday’s trading session at $74.44, declining 7% to reach its lowest level in 52 weeks. The sell-off occurred even as Berkshire Hathaway continued accumulating shares.
According to a recently filed Form 4 document, Berkshire acquired an additional 2.4 million Lennar shares during Thursday and Friday’s trading sessions. The transactions, which included both Class A and Class B shares, totaled $192.6 million.
Berkshire’s position in the residential construction company has expanded to roughly 12%, representing an investment of approximately $2.2 billion. This marks a significant increase from the stake disclosed at the conclusion of Q2.
The acquisition activity has been consistent. On October 1, Berkshire purchased 705,690 Class A shares at weighted average costs between $79.49 and $81.46 per share. The conglomerate also acquired 4,852 Class B shares during the same session.
Trading activity intensified on October 2. Berkshire accumulated 1,655,866 Class A shares at weighted average prices ranging from $78.37 to $81.90. An additional 10,176 Class B shares were purchased as well.
Combined, Berkshire’s various subsidiaries currently own 28.4 million Class A shares and 568,028 Class B shares. While Warren Buffett maintains controlling interest in Berkshire Hathaway, he disclaims beneficial ownership of the Lennar position beyond his economic interest in Berkshire itself.
What Triggered the Lennar Selloff
The Monday decline wasn’t coincidental. An investigation published by Hunterbrook, a media and investment research firm, questioned Lennar’s business dealings with Millrose Properties, a land-banking entity that Lennar separated in 2025.
According to Hunterbrook’s findings, Lennar allegedly transferred over 700 residential units to Millrose, which subsequently converted them to rental properties. The investigation suggests Millrose paid premiums exceeding what individual homebuyers would typically spend.
Neither Lennar nor Millrose provided statements when the investigation initially surfaced. The lack of response contributed to investor uncertainty and downward pressure on shares.
It remains unclear whether Berkshire continued its purchasing activity on Monday. Given its ownership exceeds 10%, securities regulations require the firm to file disclosures within two business days of any transaction, meaning Monday purchases would need reporting by Wednesday.
Disappointing Financial Performance
The stock decline is unfolding against challenging operational results. Lennar’s most recent quarterly report showed misses across key metrics. Adjusted earnings per share reached $1.23, falling short of the $1.29 consensus estimate, while revenue of $8.05 billion trailed the $8.31 billion forecast.
New home orders declined year-over-year, suggesting softening consumer demand in the housing market. Analysts have responded with cautious outlooks.
Morgan Stanley initiated coverage with an underweight rating and established a $65 price target, citing concerns about margin compression. Raymond James maintained its underperform stance, highlighting Lennar’s strategy to sustain production levels despite volatile mortgage rate conditions.
Truist Securities continues its hold rating with a $75 price objective. Citizens maintained a market perform designation but observed a modest decrease in incentive rates, representing a potential positive development.
Management continues implementing shareholder return programs through stock repurchases, dividend distributions, and debt reduction. Berkshire’s aggressive accumulation strategy has resulted in unrealized losses given Monday’s closing price represents the stock’s weakest performance since 2022.
Lennar isn’t Berkshire’s only exposure to residential construction. The conglomerate wholly owns Clayton Homes and completed an $8.5 billion acquisition of Taylor Morrison in July.
Market observers speculate that Ted Weschler, a portfolio manager responsible for approximately 6% of Berkshire’s $350 billion equity portfolio, may be directing the Lennar investment strategy. Weschler operates under CEO Greg Abel’s oversight.
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