The builders universe includes a number of companies Wetenhall covers, including Pulte Homes
, Toll Brothers and KB Homes .
But he said the company in the best position to "react to an adverse operating environment with very severe competition from lower-priced foreclosures" is Lennar.
Lennar , the analyst said, has "a very large distressed investment strategy, so they’re able to supplement and partly offset weakness in the core homebuilding operation due to the success they’re having buying foreclosures and distressed assets."
WATCH:In a recent interview, Wetenhall told CNBC that he thinks "all homebuilders are bad" at this point.
CNBC Data Pages:
Robert Wetenhall does not own shares of the companies mentioned but RBC Capital Markets plans to make a market in some of these securities.