Meritage Homes(US:MTH)2025-10-28 20:34Financial Performance - Homes closed in Q3 2025 totaled 3,685 units, a 7% decrease from 3,942 units in Q3 2024[4] - Home closing revenue for Q3 2025 was $1.4 billion, down 12% from $1.6 billion in Q3 2024[4] - Average sales price for closings in Q3 2025 was $380,000, a 5% decrease from $402,000 in Q3 2024[4] - Net earnings for Q3 2025 were $99 million ($1.39 per diluted share), a 49% decrease from $196 million ($2.67 per diluted share) in Q3 2024[4] - Home closing gross margin for Q3 2025 was 19.1%, a decrease of 570 basis points from 24.8% in Q3 2024[4] - Total closing revenue for the nine months ended September 30, 2025, was $4,396,914, down 7% from $4,750,588 in 2024[19] - Net earnings for the three months ended September 30, 2025, were $99,297, a decline of 49% compared to $195,966 in 2024[17] - Earnings per common share for the three months ended September 30, 2025, were $1.40, down 48% from $2.70 in 2024[18] - Adjusted net earnings for the nine months ended September 30, 2025, were $384,223, a decrease from $616,413 in the same period of 2024, with diluted earnings per share dropping to $5.13 from $8.36[37] Orders and Backlog - Home orders increased by 4% year-over-year to 3,636 units in Q3 2025, with a home order value of $1.4 billion[4] - Ending backlog units decreased by 26% year-over-year to 1,699 units, with a backlog value of $670 million, down 28%[4] - Homes ordered in Q3 2025 totaled 3,636 with a value of $1,415,089, compared to 3,512 homes ordered valued at $1,425,610 in Q3 2024, indicating a slight increase of 3.5% in homes ordered but a decrease of 0.7% in total value[28] - The order backlog as of September 30, 2025, was 1,699 homes valued at $670,007, down from 2,284 homes valued at $931,656 as of September 30, 2024, reflecting a decrease of 25.6% in homes and 28.1% in value[30] Shareholder Returns - The company returned $85 million to shareholders through dividends and share repurchases in Q3 2025, totaling nearly $237 million year-to-date[7] Cash and Assets - Cash and cash equivalents at September 30, 2025, totaled $729 million, reflecting an increase from $652 million at December 31, 2024[12] - Total assets as of September 30, 2025, were $7,758,510, an increase from $7,162,654 as of December 31, 2024[23] - Cash and cash equivalents rose to $728,937 as of September 30, 2025, compared to $651,555 at the end of 2024[23] Operational Metrics - The company reported a total cost of closings of $1,148,254 for the three months ended September 30, 2025, a decrease of 4% from $1,195,204 in 2024[17] - The company experienced a significant increase in land closing revenue, which rose by 503% to $16,068 for the three months ended September 30, 2025, from $2,665 in 2024[17] - The total number of active communities as of September 30, 2025, was 334, an increase from 278 in the same period of 2024, showing a growth in operational capacity[30] Debt and Financing - The debt-to-capital ratio increased to 25.7% as of September 30, 2025, compared to 20.6% at the end of 2024, indicating a rise in leverage[37] - Capitalized interest at the end of Q3 2025 was $71,201, up from $53,731 at the end of Q3 2024, indicating increased financing costs associated with homebuilding[32] Tax and Effective Rate - The company reported an effective income tax rate of 22.6% for Q3 2025, slightly higher than the 21.6% reported in Q3 2024[37] Company Overview - Meritage Homes Corporation is the fifth-largest public homebuilder in the U.S., focusing on energy-efficient and affordable homes across multiple states[39]