Why Is Meritage (MTH) Up 4.6% Since Last Earnings Report?

Core Viewpoint - Meritage Homes reported strong first-quarter 2024 earnings, with both earnings and total revenues exceeding expectations and showing year-over-year growth, driven by higher deliveries and effective strategies [2][3]. Earnings & Revenue Discussion - Earnings per share (EPS) reached $5.06, surpassing the Zacks Consensus Estimate and the previous year's figure of $3.54 by 42.9% [3]. - Total revenues amounted to $1.472 billion, reflecting a 14.5% increase from $1.285 billion in the prior year [3]. Segment Discussion - Homebuilding revenues were $1.468 billion, a 15% increase from $1.26 billion in the prior-year quarter, exceeding the consensus estimate by 14.5% [4]. - Home closing revenues totaled $1.466 billion, up 16% year-over-year, while land closing revenues fell 87% to $2.31 million [4]. Operational Metrics - The company closed 3,507 homes, a 21% increase from 2,897 units year-over-year, with an average selling price (ASP) of $418,000, down 4% from the previous year [5]. - Total home orders rose 14% to 3,991 homes, with a dollar value increase of 8% to $1.63 billion [6]. Backlog and Margins - The backlog at quarter-end was 3,033 units, down 23% year-over-year, with a backlog value of $1.24 billion, a decrease of 29% [7]. - Adjusted home closing gross margin expanded by 340 basis points to 25.8% [7]. Financial Services - Revenues from the Financial Services segment increased by 11% to $6.35 million compared to the prior-year quarter [8]. Balance Sheet - Cash and cash equivalents at the end of Q1 2024 were $905.3 million, down from $921.2 million at the end of 2023 [10]. - The company owned or controlled 66,400 lots, an increase from 60,900 lots a year ago [10]. Dividend and Share Repurchase - The quarterly cash dividend was raised to 75 cents per share from 27 cents, with $27.2 million paid in dividends during Q1 [11]. - The company repurchased 362,419 shares for $55.9 million, with $129.1 million remaining under the authorized repurchase program [11]. 2024 Outlook - Meritage projects 14,500-15,000 home closings for the year, expecting home closing revenues of $6-$6.2 billion [12]. - EPS is anticipated to be in the range of $19.20-$20.70, with an effective tax rate of 22.5% [12]. Estimate Revisions - Recent estimates for the company have trended upward, with a consensus estimate shift of 21.09% [13]. VGM Scores - Meritage has a subpar Growth Score of D, a Momentum Score of A, and an overall VGM Score of B, indicating a favorable position in the investment strategy [14]. Industry Performance - Meritage operates within the Zacks Building Products - Home Builders industry, where competitor PulteGroup reported revenues of $3.95 billion, a year-over-year increase of 10.5% [16].