Lennar (LEN) Downgrade is Due to High Rates, Says Jim Cramer

We recently published 10 Stocks Jim Cramer Talked About.  Lennar Corporation (NYSE:LEN) is one of the stocks on Jim Cramer talked about.

Lennar Corporation (NYSE:LEN) is another homebuilding stock that has struggled. Over the year, its shares are flat, but year-to-date they are up by 15%. January has proven to be an important month for the firm after it sold a stake in its multifamily business to asset management firm TPG, which also committed an additional $1 billion. On the 7th, Citizens Financial downgraded Lennar Corporation (NYSE:LEN)’s shares to Market Perform from Market Outperform after the firm’s fiscal fourth quarter earnings report. The financial firm pointed to inventory clearance as the reason behind the pessimism, as it believes Lennar Corporation (NYSE:LEN) might have to wait for a couple of quarters before completely clearing its inventory. Cramer discussed UBS’ downgrade that reduced the rating to Neutral from Buy and tied it with interest rates:

“Alright David, you talked about what punches above its weight. And that’s housing, as well as Ford stock. Okay, this morning, jeez these research firms are taking aim at housing. . .And then, UBS downgrades Lennar. . .This is a sign, again, rates are too high, rates are too high, and that’s because they were so low. . .it’s relative to where they were and you can’t buy starter homes. . . .these cannot get any traction, none. . .”

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Disclosure: None. This article is originally published at Insider Monkey.