I have been involved with the stock market for a few years now, with consistent small investments in about a dozen stocks and/or mutual funds. I am still learning but have grown fond of watching the market trends and finding interesting stocks. I want to write about and share investments that have caught my eye in an effort to start the conversation with other fellow investors. I would love to hear about one on your list as well and we can watch our money grow together.
One long-term industry that has always piqued my interest (obviously) is real estate. I have found one stock in particular that seems to have great potential and I want to share it with you. It is very likely you have seen this company’s logo or name around Minnesota – especially in developing suburban areas, but it also has a very strong national presence.
Lennar Corporation (LEN) is a home construction company headquartered in Miami, Florida. Originally founded in 1954 and is doing very well to this day, generating over $20 billion in revenues in 2019. Taken directly from their annual report: “We are the largest homebuilder in the United States in terms of consolidated revenues and earnings, an originator of residential and commercial mortgage loans, a provider of title insurance and closing services and a developer of multifamily rental properties.”
Given this history, obviously it isn’t a new small business that has the potential to blow up 300% overnight, and my goal here isn’t to point out a stock like that. My goal is to identify a well-established company that has potential to be a good long-term investment for beginners. As of today, Lennar (LEN) stock has increased 48.5% over the last five years, and 28.75% in the past year and a lot of market experts are naming it one of the top real estate stocks to buy.
Furthermore, they built over 50,000 new homes in 2019 and will likely exceed that this year. This large market share in the new residential construction is where you might have seen their name, and where I have had personal experience with the company. Cities around here like Lakeville, Rosemount, and Inver Grove Heights have been flooded with Lennar construction sites. I recently went with some buyers to their new Lennar home in Rosemount and there was a Lennar construction manager present at the walk-through. He was very helpful in explaining the status of final touches throughout the home.
Newly built homes are becoming more and more affordable making the option of living in a brand new home available to an increasing amount of people. The fact that Lennar specializes in just that – new construction – makes another case for the value of their stock. According to 19 analysts on Robinhood, right now, 63% of them would advise to Buy, and the rest would advise to Hold (none say to Sell).
Here are a couple links for more stock info available to the public:
https://investors.lennar.com/stock-information/stock-quote-and-chart
https://finance.yahoo.com/quote/LEN/
Since you may have been a little hesitant to read investing advice from a relatively young and inexperienced investor like myself, I hope some of these numbers and facts help back my opinion. If you don’t have the means to buy a house or invest in real estate that way, stocks can be a great way to get your feet wet in real estate. No matter what industry leave a reply below with a stock that’s on your watchlist!
Cheers to all my readers and please come back for more next week,
Brady
Brady Arthur Homes and Drones 