Berkshire Builds Exposure to Housing. Buy DR Horton Stock.

D.R. Horton is a new Berkshire Hathaway holding, as of the second quarter. (Brandon Bell / Getty Images)

Warren Buffett’s new stake in UnitedHealth is getting plenty of buzz, but investors should also pay attention to his growing interest in home builders’ stocks.

Berkshire Hathaway’s latest 13F filing released Thursday revealed a new position in D.R. Horton in the second quarter. This move could signal a broader conviction that interest rates might trend lower, which would benefit housing.

Uncle Warren isn’t the only one that sees opportunity in the sector. After reviewing D.R. Horton stock last month, I liked what I saw technically and fundamentally. And there are several other housing stocks that looked poised for a solid run.

So far this year, D.R. Horton stock has climbed 19%, outperforming peers like Toll Brothers, which has notched a 4% year-to-date rise. It has also outpaced the 3% drop of Lennar, a holding that Buffett increased in the second quarter.

Horton stock recently broke above a bullish inverse head-and-shoulders neckline at $150, a key technical area. I believe it has room to run and could challenge the very round $200 level by year-end, which coincides with a rejection precisely there last September before its significant correction began.

DR Horton closed at $165.62 Friday.

One home builder that doesn’t get the recognition it deserves is Taylor Morrison Home, which continues to show impressive relative strength. Among major home-building stocks, it’s the only name currently less than 10% off its 52-week highs, down just 9%, while peers remain further off their recent peaks.

The stock briefly dipped after breaking above a bear flag pattern in January. But it regained momentum with a decisive move on Aug. 13, jumping 5% on heavy volume as it cleared a cup base buy point at $68.33. Taylor Morrison has now logged gains in eight of the last 10 week. It notably showed strength the week ending Aug. 1, when it rose 1.5% while the iShares U.S. Home Construction exchange-traded fund fell fractionally. Taylor Morrison Home was trading at $67.38 Friday.

Technically, I see this name targeting $75 by the end of the fourth quarter, with a possible move to the $100 level in early 2026.

Taylor Morrison Home closed at $67.98 Friday.

Among the top 10 holdings in the iShares U.S. Home Construction ETF, Masco stands out as an overlooked housing play, as it shows fresh signs of momentum. While the building products and equipment play’s 2025 performance has been modest—up just 1% this year—the stock has surged 14% over the past month, signaling a potential inflection point.

On the daily chart, Masco recently broke out of a bullish ascending triangle, with a pivot at the round $70 level. Notably, the stock gained a combined 8% on Aug. 12 to 13, clearing the pattern with conviction. This came just days after a failed breakout on July 31, in the rectangle, which had bears salivating.

With renewed strength and technical confirmation in place, I’m watching for a move toward the $85 level in the early fourth quarter. Stay constructive above $67.50.

Masco was trading at $73.52 Friday.

Sherwin-Williams, a dominant force in the global paint and coatings industry, is up 7% year to date and stands to benefit meaningfully from any rebound in the housing sector.

A review of the weekly chart going back to 2020 shows the stock has reclaimed a key technical level, breaking above a cup-with-handle base with a pivot near $350. This base formed over 2½ years, and as the adage goes, “the longer the base the greater the space,” meaning a large potential move higher.

With this technical breakout back in place, Sherwin-Williams stock has room to run from its current $364.40. The next major level to watch is the very round $400 mark, which aligns with a previous rejection area from November of last year. I believe that level can be touched by year-end.

Write to Doug Busch at douglas.busch@barrons.com