Why small-cap stocks could become the stock market's latest 'Magnificent Seven'
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Aug 26 2025
0mins
Should l Buy MRP?
Source: MarketWatch
Market Performance: The Russell 2000 Index has risen approximately 5% over the past month, outperforming the Nasdaq 100's 1% gain.
Tech Sector Struggles: The Nasdaq 100 is being negatively impacted by weaknesses in major tech stocks, particularly the "Magnificent Seven."
Small Caps Outlook: Experts believe small-cap stocks will continue to outperform and may replace the dominance of large tech stocks.
Investment Insights: Four money managers shared their insights on promising small-cap stocks, highlighting five specific recommendations.
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Analyst Views on MRP
Wall Street analysts forecast MRP stock price to rise
2 Analyst Rating
2 Buy
0 Hold
0 Sell
Moderate Buy
Current: 31.450
Low
35.00
Averages
36.50
High
38.00
Current: 31.450
Low
35.00
Averages
36.50
High
38.00
About MRP
Millrose Properties, Inc., through certain subsidiaries, operates as an operational and capital solution for home builders and land development companies to finance the acquisition and development of land assets through its Homesite Option Purchase Platform (known as the HOPP’R). The HOPP’R is a comprehensive suite of systems and procedures that has been developed to operate and manage the acquisition, financing and development of land assets on a large scale. The land development activities include the installation of all necessary infrastructure required to build homes, including drainage, sewage, water lines, roads, sidewalks, utility lines, grading, landscaping and, in certain cases, the construction of recreational facilities, common area elements and other amenities.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Short-Term Strategy Adjustment: While Berkshire exited its position in D.R. Horton after a quarter, the continued investment in Lennar indicates a short-term strategy in housing stocks, potentially influencing market expectations for the company.
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- Land Risk Management: By spinning off its land assets to create Millrose Properties, Lennar successfully achieved a land-light business model, thereby reducing land risk and allowing it to focus capital on core homebuilding operations, enhancing operational efficiency.
- Market Expansion: Through the acquisition of Rausch Coleman Homes, Lennar not only expanded its market footprint but also gained options on land assets via Millrose, further strengthening its competitive position in new markets.
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- Dividend Yield: Millrose Properties boasts a 9.5% dividend yield, reflecting its stable cash flow and attractiveness, with upcoming fourth-quarter financial results likely to further validate its financial health.
- Earnings Beat: Visa's quarterly earnings report on January 29 showed earnings of $3.17 per share, exceeding the consensus estimate of $3.14, with quarterly revenue reaching $10.9 billion, indicating strong performance and demand in the payments industry.
- Apple's Performance: Apple reported first-quarter revenue of $143.76 billion on January 29, surpassing analyst expectations of $138.42 billion, demonstrating robust product demand and further solidifying its leadership position in the technology sector.
See More
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- Attractive Yield: AGNC Investment Corp. boasts a 13.36% dividend yield, yet this high figure may indicate significant underlying financial risks, particularly in the context of declining stock prices.
- Dividend Trap Warning: When a company pays out more than 100% of its earnings, it is effectively cannibalizing its own capital to maintain dividends, which could lead to future cuts and negatively impact investor confidence.
- Debt Burden Risks: Companies in cyclical sectors may rely on debt to fund dividends, a practice that is unsustainable during downturns and increases bankruptcy risk, necessitating caution from investors.
- Tax Implications Analysis: The tax treatment of high-yield stocks is complex, as non-qualified dividends are taxed at the highest marginal income tax rate, prompting investors to consider holding such stocks in tax-advantaged accounts to mitigate tax liabilities.
See More
Berkshire Hathaway Boosts Lennar Stake to $910 Million, Bets on Housing Market
- Investment Scale Expansion: Warren Buffett's Berkshire Hathaway purchased $800 million of Lennar stock in August and subsequently increased its stake to $910 million, demonstrating strong confidence in the housing market, which is expected to drive Lennar's market performance.
- Short-Term Strategy Adjustment: While Berkshire exited its position in D.R. Horton after a quarter, the continued investment in Lennar indicates a short-term strategy in housing stocks, potentially influencing market expectations for the company.
- Land Risk Management: By spinning off its land assets to create Millrose Properties, Lennar successfully achieved a land-light business model, reducing land risk and allowing it to focus capital on core homebuilding operations, thereby enhancing long-term profitability.
- Market Expansion Opportunities: Following the acquisition of Rausch Coleman Homes' homebuilding operations, Lennar has expanded its market footprint and gained land asset options through Millrose, strengthening its competitiveness and operational efficiency in new markets.
See More
Berkshire Hathaway Increases Lennar Stake to $910 Million, Reducing Land Risk
- Increased Investment: Berkshire Hathaway purchased $800 million in Lennar stock in August and subsequently raised its stake to $910 million, reflecting strong confidence in the housing market, which is expected to drive Lennar's stock price higher.
- Land Risk Management: By spinning off its land assets to create Millrose Properties, Lennar successfully achieved a land-light business model, thereby reducing land risk and allowing it to focus capital on core homebuilding operations, enhancing operational efficiency.
- Market Expansion: Through the acquisition of Rausch Coleman Homes, Lennar not only expanded its market footprint but also gained options on land assets via Millrose, further strengthening its competitive position in new markets.
- Long-Term Growth Potential: Lennar's business model and strategic positioning suggest sustainable growth prospects, attracting investor interest, especially against the backdrop of a recovering housing market.
See More
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Dividend Announcement: Millrose Properties (MRP) has declared a quarterly dividend of $0.75 per share, reflecting a 2.7% increase from the previous dividend of $0.73.
Dividend Details: The dividend is payable on January 15, with shareholders of record on January 5, and the ex-dividend date also set for January 5.
Market Outlook: BTIG has launched coverage of 10 real estate companies, including Millrose Properties, with a cautious outlook on the sector.
Citi's Watch: Millrose Properties has been placed on a 90-day upside catalyst watch by Citi, indicating potential positive developments ahead.
See More
KBW Announces Q4 2025 Index Rebalancing with Changes Across Six Indices
- Index Component Changes: The KBW Nasdaq Insurance Index adds four companies, including Arthur J. Gallagher & Co. and Chubb Limited, while dropping four others, reflecting market dynamics.
- Regional Banking Index Update: The KBW Nasdaq Regional Banking Index adds Axos Financial, Inc. and removes Synovus Financial Corp., indicating a focus on emerging fintech companies.
- Dividend Yield Index Adjustments: The KBW Nasdaq Financial Sector Dividend Yield Index adds eight companies and drops eight, demonstrating ongoing investor interest in high-yield investments.
- REIT Index Expansion: The KBW Nasdaq Premium Yield Equity REIT Index adds twelve companies while removing nine, reflecting the vibrancy of the real estate market and investor confidence.
See More
