Jefferies initiated coverage of Lennar with a Hold (LEN) rating and $117 price target amid starting coverage on the three largest U.S. homebuilders. While the analyst believes the builders have favorable long-term demand trends, the next several quarters could be “choppy” with buyers facing affordability issues, so the firm is “picking our spots until we get more clarity on the macro,” the analyst tells investors. Like D.R. Horton (DHI), the firm is cautious on Lennar because as the company strives to turn its homes in inventory to drive cash flows and returns it “will price to the market conditions in order to do so,” the analyst tells investors.
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