Lennar(US:LEN) The Motley Fool·2025-10-02 08:44Core Viewpoint - Warren Buffett's significant investment in Lennar highlights the importance of shareholder yield as a key metric for investors [2][5][7] Shareholder Yield - Shareholder yield measures total cash returned to shareholders as a percentage of market cap, including dividends, stock buybacks, and debt reduction [3] - Lennar's shareholder yield is calculated by combining its dividend yield of 1.6% and an estimated stock buyback yield of 7.1%, resulting in a total shareholder yield of 8.7% [6][7] Company Performance - Lennar paid a dividend of $0.50 per share in Q3 2025, leading to an annualized dividend payout of $2 per share [5] - The company repurchased 4.1 million shares for $507 million in Q3 2025 and is projected to spend approximately $2.4 billion on stock buybacks in the current fiscal year [6] Market Conditions - Lennar's fiscal Q3 revenue from home sales fell 9% year over year, attributed to lower average sales prices and a decrease in gross margins from 22.5% to 17.5% [10] - The average 30-year fixed-rate mortgage rate has recently dropped to a three-year low, which could improve home affordability and benefit Lennar [11] Long-term Prospects - The U.S. housing market faces a shortage, with an estimated need for over 4.7 million new homes, positioning Lennar favorably as one of the largest homebuilders [12]