Meritage Homes(MTH)

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Meritage Homes Announces Entry into the Gulf Coast Markets with Acquisition of the Assets of Elliott Homes
GlobeNewswire News Room· 2024-10-30 12:00
Acquisition Details - Meritage Homes acquires Elliott Homes, a top five Gulf Coast homebuilder, marking its entry into the Gulf Coast markets [1][2] - The acquisition includes over 5,500 lots, with production operations expected to commence in existing entry-level communities by the end of the year [2] - The operations are anticipated to make a meaningful contribution to Meritage's performance in 2025 [2] Strategic Alignment and Leadership - The acquisition aligns with Meritage's strategy of building affordable entry-level homes and is the company's first acquisition since 2014 [3] - Phillippe Lord, CEO of Meritage Homes, highlights the acquisition as a strategic move to expand into desirable Gulf Coast markets [3] - Brandon Elliott, founder and CEO of Elliott Homes, expresses pride in his team's growth and looks forward to leveraging Meritage's national scale to deliver affordable, quality homes [3] Company Overview - Meritage Homes is the fifth-largest public homebuilder in the U.S., based on homes closed in 2023 [4] - The company operates in multiple states, including Arizona, California, Colorado, Utah, Texas, Florida, Georgia, North Carolina, South Carolina, and Tennessee [4] - Meritage has delivered over 190,000 homes in its 38-year history and is recognized for energy-efficient homebuilding, having received multiple awards from the U.S. Environmental Protection Agency [5] Industry and Market Position - Meritage Homes specializes in energy-efficient and affordable entry-level and first move-up homes, catering to a broad market segment [4] - The company's reputation is built on distinctive style, quality construction, and award-winning customer experience [5] - The acquisition of Elliott Homes strengthens Meritage's presence in the Gulf Coast region, a highly desirable market for homebuilding [3]
Meritage Homes (MTH) Q3 Earnings and Revenues Top Estimates
ZACKS· 2024-10-29 22:50
Company Performance - Meritage Homes reported quarterly earnings of $5.34 per share, exceeding the Zacks Consensus Estimate of $5.05 per share, but down from $5.98 per share a year ago, representing an earnings surprise of 5.74% [1] - The company posted revenues of $1.59 billion for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 0.65%, although this is a slight decrease from year-ago revenues of $1.61 billion [2] - Over the last four quarters, Meritage has consistently surpassed consensus EPS estimates [2] Stock Outlook - Meritage shares have increased by approximately 5.9% since the beginning of the year, while the S&P 500 has gained 22.1% [3] - The current consensus EPS estimate for the upcoming quarter is $4.70 on revenues of $1.56 billion, and for the current fiscal year, it is $21.09 on revenues of $6.3 billion [7] - The estimate revisions trend for Meritage is currently unfavorable, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] Industry Context - The Building Products - Home Builders industry, to which Meritage belongs, is currently ranked in the top 26% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]
Meritage Homes(MTH) - 2024 Q3 - Quarterly Results
2024-10-29 20:31
Financial Performance - Meritage Homes reported a third quarter 2024 home closing volume of 3,942 units, an 8% increase year-over-year, with a record backlog conversion rate of 145%[1][3] - Home closing revenue for Q3 2024 was $1.6 billion, a 2% decrease from Q3 2023, attributed to a 9% decline in average sales price (ASP) on closings[2][5] - The average sales price for home closings in Q3 2024 was $402,000, down 9% from $443,000 in Q3 2023, with entry-level homes representing 93% of sales[2][4] - Net earnings for Q3 2024 were $196 million, or $5.34 per diluted share, reflecting a 12% decrease from $221.8 million, or $5.98 per diluted share, in Q3 2023[2][10] - Home closing revenue for Q3 2024 was $1,585,784, a decrease of 2% from $1,610,317 in Q3 2023[29] - Total closing revenue for Q3 2024 was $1,588,449, down 2% from $1,613,100 in Q3 2023[29] - Net earnings for Q3 2024 were $195,966, a decrease of 12% compared to $221,760 in Q3 2023[29] - Home closing gross profit for Q3 2024 was $392,565, down 9% from $429,575 in Q3 2023[29] - Total closing gross profit for Q3 2024 was $393,245, a decrease of 9% from $429,823 in Q3 2023[29] - Home closing revenue for the nine months ended September 30, 2024, was $4,745,618, an increase of 7% from $4,415,261 in the same period of 2023[31] - Net earnings for the nine months ended September 30, 2024, increased to $613,537, compared to $539,897 for the same period in 2023, representing a growth of approximately 13.6%[35] Operational Metrics - The company’s gross margin for home closings in Q3 2024 was 24.8%, a decrease of 190 basis points from 26.7% in the prior year due to higher lot costs and increased financing incentives[2][6] - For the first nine months of 2024, total sales orders increased by 10%, driven by a 10% increase in average absorption pace compared to the same period in 2023[11] - The company plans to close between 3,750 and 3,950 units in Q4 2024, with expected revenue of $1.50 to $1.59 billion and a gross margin of 22.5% to 23.5%[25] - The total order backlog as of September 30, 2024, was 2,284 homes valued at $931,656, compared to 3,608 homes valued at $1,558,637 in the same period of 2023, indicating a significant decrease in backlog value of approximately 40.1%[38] - Homes ordered in the three months ended September 30, 2024, totaled 3,512, valued at $1,425,610, compared to 3,474 homes valued at $1,495,542 in the same period of 2023, reflecting a decrease in value of approximately 4.7%[37] - Total homes closed in the three months ended September 30, 2024, reached 3,942, with a total value of $1,585,784, compared to 3,638 homes valued at $1,610,317 in the same period of 2023, indicating a decrease in value of about 1.5%[37] Financial Position - The company’s cash and cash equivalents at September 30, 2024, totaled $831.6 million, down from $921.2 million at December 31, 2023[20] - Total assets as of September 30, 2024, were $7,103,452, up from $6,353,134 at the end of 2023[32] - Total stockholders' equity increased to $5,029,790 as of September 30, 2024, compared to $4,611,900 at the end of 2023[33] - The debt-to-capital ratio increased to 20.7% as of September 30, 2024, up from 17.9% as of December 31, 2023[42] - The company reported a net cash used in operating activities of $(128,013) for the nine months ended September 30, 2024, compared to $460,092 for the same period in 2023[35] Market and Strategic Insights - The company is focused on offering entry-level and first move-up homes as part of its market strategy[47] - The company has 278 active communities as of September 30, 2024, compared to 272 active communities at the end of 2023, showing a slight increase[39] - The company has delivered over 190,000 homes in its 38-year history, emphasizing its reputation for quality construction and customer experience[45] - Meritage Homes Corporation is the fifth-largest public homebuilder in the U.S., with operations across multiple states including Arizona, California, and Texas[44] Risks and Challenges - The company faces significant uncertainties and risks that may lead to fluctuations in stock and note prices, including interest rate increases and mortgage availability issues[47] - Inflation in material costs for community development and home construction is a concern, potentially impacting profit margins[47] - The company is experiencing challenges related to supply chain and labor constraints, which could affect operational efficiency[47] - Cancellation rates and slow absorption rates are potential risks that may adversely impact sales performance[47] - The company has limited geographic diversification, which may expose it to regional market fluctuations[47] - There are concerns regarding the availability and cost of finished lots and undeveloped land, which could hinder growth[47] - Potential disruptions from epidemics or pandemics could impact business operations and sales[49] - The company is subject to various regulatory compliance requirements that may affect its financial services operations[47] - Key personnel loss and information technology failures pose risks to the company's operational stability[47]
Meritage Homes reports third quarter 2024 results
GlobeNewswire News Room· 2024-10-29 20:30
Core Insights - Meritage Homes Corporation reported third quarter results for 2024, showing a slight increase in home orders and a decrease in average sales price, reflecting a strategic pivot towards affordable homes [1][3][4] Summary of Operating Results - Homes closed in Q3 2024 totaled 3,942 units, an 8% increase from 3,638 units in Q3 2023 [2] - Home closing revenue decreased by 2% to $1.585 billion from $1.610 billion year-over-year [2] - Average sales price for closings fell by 9% to $402,000 compared to $443,000 in the previous year [2] - Home orders increased by 1% to 3,512 units from 3,474 units in Q3 2023 [2] - Home order value decreased by 5% to $1.426 billion from $1.496 billion year-over-year [2] Financial Performance - Net earnings for Q3 2024 were $196 million, down 12% from $222 million in Q3 2023, resulting in diluted EPS of $5.34, a decrease of 11% from $5.98 [2][9] - Earnings before income taxes were $250 million, a 13% decrease from $286 million in the prior year [2][9] - Home closing gross margin was 24.8%, down from 26.7% in Q3 2023, attributed to higher lot costs and increased financing incentives [6] Management Strategy - The company emphasized a shift towards affordable, quick-turning move-in ready homes, which contributed to achieving the highest third quarter closing volume [3] - Management noted that nearly 45% of this quarter's closings were also sold within the same quarter, leading to a record backlog conversion rate of 145% [3] Capital Allocation and Liquidity - Land acquisition and development spending totaled $659.4 million in Q3 2024, with nearly 7,800 net new lots acquired [3][18] - The company ended the quarter with cash of $831.6 million and a net debt-to-capital ratio of 8.8% [3][20] Year-to-Date Results - For the first nine months of 2024, total sales orders increased by 10%, driven by a 10% increase in average absorption pace [10] - Home closing revenue for the first nine months rose by 7% to $4.746 billion, reflecting a 15% increase in home closing volume [11] - Net earnings for the first nine months were $614 million, a 14% increase from $540 million in the same period of 2023 [17] Guidance - The company provided guidance for Q4 2024, projecting home closing volume between 3,750 and 3,950 units, with expected home closing revenue of $1.50 to $1.59 billion [22]
Meritage Homes Appoints Erin Lantz to its Board of Directors
GlobeNewswire News Room· 2024-10-15 13:00
Core Points - Meritage Homes has appointed Erin Lantz as an independent director to its Board of Directors, effective October 14, 2024, increasing the board size to 11 directors [1] - The appointment reflects the company's commitment to board refreshment and diversity of thought [4] - The Board plans to consider Ms. Lantz for committee appointments in upcoming meetings [1] Company Background - Meritage Homes is the fifth-largest public homebuilder in the U.S., focusing on energy-efficient and affordable homes [10] - The company has delivered over 185,000 homes in its 38-year history and is recognized for quality construction and customer experience [11] Erin Lantz's Experience - Ms. Lantz has over 20 years of leadership experience in technology-related offerings, currently serving as Chief Revenue Officer for Ethos [2] - She has held significant positions at Zillow Group and Bank of America, bringing valuable insights to the board [2][3] - Her public company director experience includes roles at Blend Labs, TrueCar, and Washington Federal [3] Board Declassification Proposal - The Board has approved a proposal to declassify the Board of Directors, which will be presented to stockholders at the 2025 annual meeting [5] - This move is in response to stockholder feedback favoring annually elected boards for increased accountability [5] - The declassification aligns with the company's refreshment initiative to transition longer-tenured directors over time [5] Governance and Communication - The company plans to file a proxy statement with the SEC regarding the Declassification Proposal, urging stockholders to review the materials [6] - Key participants in the solicitation of proxies include the executive chairman and other directors [7][8]
Meritage Homes: Expect Value To Keep Building
Seeking Alpha· 2024-10-13 03:40
Group 1 - The homebuilding market is experiencing renewed interest due to the potential return to low interest rates, which could positively impact housing demand [1] - Crude Value Insights focuses on cash flow and companies that generate it, highlighting value and growth prospects in the oil and natural gas sector [1] Group 2 - Subscribers to Crude Value Insights gain access to a 50+ stock model account and in-depth cash flow analyses of exploration and production (E&P) firms [2] - The service includes live chat discussions about the oil and gas sector, enhancing community engagement and information sharing [2]
Meritage Homes Corporation (MTH) Hits Fresh High: Is There Still Room to Run?
ZACKS· 2024-09-19 14:21
Company Performance - Meritage Homes (MTH) shares have increased by 4.3% over the past month, reaching a new 52-week high of $211.01 [1] - Year-to-date, Meritage has gained 16.3%, compared to 21.2% for the Zacks Construction sector and 29.4% for the Zacks Building Products - Home Builders industry [1] Earnings and Revenue - Meritage has consistently exceeded earnings expectations, reporting EPS of $6.31 against a consensus estimate of $5.17 in its last earnings report [2] - For the current fiscal year, Meritage is projected to achieve earnings of $21.14 per share on revenues of $6.29 billion, reflecting a 6.07% increase in EPS and a 2.93% increase in revenues [3] - The next fiscal year forecasts earnings of $22.09 per share on $6.72 billion in revenues, indicating year-over-year changes of 4.48% and 6.77%, respectively [3] Valuation Metrics - Meritage has a Value Score of B, with Growth and Momentum Scores of D and B, respectively, resulting in a VGM Score of B [6] - The stock trades at 9.6X current fiscal year EPS estimates, below the peer industry average of 10.3X, and at 9.7X trailing cash flow compared to an average of 11X for peers [6] Zacks Rank - Meritage holds a Zacks Rank of 2 (Buy), supported by favorable earnings estimate revisions from analysts [7] - The stock aligns with the recommendation for investors to select stocks with Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, suggesting potential for further gains [7] Industry Comparison - M/I Homes, Inc. (MHO), a peer in the industry, has a Zacks Rank of 1 (Strong Buy) and is expected to post earnings of $19.76 per share on revenues of $4.42 billion for the current fiscal year [8][9] - MHO shares have increased by 8.2% over the past month, trading at a forward P/E of 8.46X and a P/CF of 9.65X [10] - The Building Products - Home Builders industry is performing well, ranking in the top 17% of all industries, indicating favorable conditions for both MTH and MHO [10]
Meritage Homes Third Quarter 2024 Earnings Conference Call and Webcast Scheduled for October 30, 2024
GlobeNewswire News Room· 2024-09-18 20:30
Core Viewpoint - Meritage Homes Corporation, the fifth largest public homebuilder in the U.S., is set to release its third quarter 2024 results on October 29, 2024, with a conference call scheduled for October 30, 2024 [1]. Company Overview - Meritage Homes is recognized as the fifth-largest public homebuilder in the United States based on homes closed in 2023 [3]. - The company specializes in energy-efficient and affordable entry-level and first move-up homes, operating in multiple states including Arizona, California, Colorado, Utah, Texas, Florida, Georgia, North Carolina, South Carolina, and Tennessee [3]. - Over its 38-year history, Meritage Homes has delivered more than 185,000 homes and is known for its distinctive style, quality construction, and award-winning customer experience [4]. Industry Leadership - Meritage Homes is an industry leader in energy-efficient homebuilding, having received the U.S. Environmental Protection Agency's ENERGY STAR® Partner of the Year for Sustained Excellence Award eleven times, along with other notable awards [4].
Operation Homefront Selects Two Military Families to Receive Mortgage-Free Meritage Homes in Austin and Charlotte
GlobeNewswire News Room· 2024-09-12 13:00
Company Overview - Meritage Homes is the fifth-largest public homebuilder in the United States based on homes closed in 2023, offering energy-efficient and affordable entry-level and first move-up homes [4] - The company has delivered over 185,000 homes in its 38-year history and is recognized for its distinctive style, quality construction, and award-winning customer experience [5] - Meritage Homes is an industry leader in energy-efficient homebuilding, having received multiple awards from the U.S. Environmental Protection Agency, including the ENERGY STAR® Partner of the Year for Sustained Excellence Award [5] Community Engagement - Meritage Homes, in partnership with Operation Homefront, is donating mortgage-free energy-efficient homes to veterans, with two families selected to receive homes in Texas and North Carolina [1][2] - The initiative aims to support veterans in establishing strong foundations and thriving in their communities, highlighting the company's commitment to social responsibility [2][3] - Each family will enter Operation Homefront's Permanent Homes for Veterans program, which provides support for homeownership and financial success [3] Operation Homefront - Operation Homefront is a national nonprofit organization focused on building strong, stable, and secure military families, ensuring they thrive in their communities [7] - The organization allocates 83 percent of its expenditures directly to programs supporting military families, providing critical financial assistance, housing, and family support services [7] - The partnership with Meritage Homes enhances Operation Homefront's mission by providing veterans with the opportunity to pursue dreams that seemed beyond their reach [3]
Meritage Homes Stock Rises 9% in a Month: Still a Buy or Too Late?
ZACKS· 2024-09-02 17:20
Core Viewpoint - Meritage Homes Corporation (MTH) has experienced a stock rally of 8.8% over the past month, outperforming both the Zacks Building Products - Home Builders industry and the S&P 500 Index, indicating strong market performance and investor interest [1][2]. Group 1: Company Performance - The company benefits from resilient housing demand and its strategy of delivering quick-turn, affordable move-in-ready homes, which aligns with current market trends [2][4]. - MTH stock is trading above its 50-day and 200-day moving averages, indicating positive technical momentum [3]. - The company achieved an average of 4.5 net sales per month in Q2 2024, exceeding its target of 4 net sales per month, showcasing strong sales performance [8]. Group 2: Strategic Advantages - Meritage Homes employs a dynamic strategy focused on nearly complete homes before sale, akin to a just-in-time inventory model, which effectively meets consumer demand for immediate occupancy [4][7]. - The 60-day closing guarantee is a key highlight of this strategy, appealing to buyers in a fast-paced market [5]. - By targeting entry-level and first-move-up homebuyers, the company positions itself to cater to the largest segment of homebuyer demand, enhancing its market appeal [6]. Group 3: Market Context - The U.S. housing market shows signs of strength, with new single-family home sales reaching a seasonally adjusted annual rate of 739,000 units in July 2024, marking a 10.6% increase [10]. - Existing home sales also exceeded expectations in July, reversing a four-month decline, indicating a potential market rebound [11]. Group 4: Valuation and Estimates - MTH stock has a forward 12-month price-to-earnings ratio of 9.13X, below the industry average of 11.53X, suggesting an attractive valuation for investors [12]. - Analysts have revised earnings estimates upward for MTH, with current and next year estimates at $21.09 and $21.98, reflecting year-over-year growth rates of 5.8% and 4.2% respectively [14].