LEN - Quick Take - Still Watching 10Q Impairment Data

Research evidence excerpt

LEN - Quick Take - Still Watching 10Q Impairment Data

Truist Securities

Equity Research Report June 30, 2026

INDUSTRIALS: Homebuilding Lennar Corporation (LEN)

LEN - Quick Take - Still Watching 10Q Impairment Data Jonathan Bettenhausen

404-439-7629

Jonathan.Bettenhausen@truist.com

Still Watching LEN Impairment Disclosure Data. Last quarter, we called out a somewhat

worrying trend in the LEN 10Q disclosures on community impairment activity. On Monday,

LEN released its 10Q for the second quarter and with it disclosed that the company tested

Current Price (Jun. 30, $90.49 151 communities for impairment, compared to 102 in 2Q25. This was a near 50% increase

2026) despite an easy comparable. Note that the absolute count of communities tested did come

Stock Rating HOLD down sequentially, but still represents 9% of LEN's total community count.

Unchanged Actual Impairments Growing but Number Modest Compared to Impairment Tests;

Price Target $90.00 Impairments Included $1m+ Communities. There have been 18 LEN communities that have seen an actual valuation adjustment YTD. This is a 19% y/y increase from the same

Unchanged period last year. This means that 14 of them saw valuation adjustments in the second quarter,

and we note that actual impairments are still relatively modest compared to the number

of communities tested for impairment. LEN also discloses some characteristics of the

communities impaired, including the ASP range of the communities impacted. Interestingly, 4 Page Document

it seems that the high end of the 14 communities impaired during the quarter included at

least one community with an expected ASP over $1m. For all of 2025, the highest ASP

Reasons for this report community impaired was $925K, so this is a step-up, albeit on a relatively small sample size