Lennar downgraded to Underperform from Sector Perform at RBC Capital

RBC Capital downgraded Lennar (LEN) to Underperform from Sector Perform with a price target of $95, down from $106. The firm cites the company’s “weak” Q4 results and Q1 guidance while noting that the expectations around a recovery in margin later this year still present risk to FY26 earnings, the analyst tells investors in a research note. Lennar’s numbers may have “reset” yet again, but there is no quick fix to margin headwinds in an affordability-constrained soft consumer environment, RBC added. While potential government actions to “support” housing could remain a positive narrative, it’s unclear whether any policies ultimately prove beneficial or harmful to builder earnings, RBC stated.