In the latest trading session, Meritage Homes (MTH - Free Report) closed at $99.47, marking a -1.32% move from the previous day. This change lagged the S&P 500's daily gain of 1.54%. At the same time, the Dow added 1.59%, and the tech-heavy Nasdaq gained 0.98%.
Coming into today, shares of the homebuilder had gained 1.23% in the past month. In that same time, the Construction sector gained 7.96%, while the S&P 500 gained 8%.
MTH will be looking to display strength as it nears its next earnings release. On that day, MTH is projected to report earnings of $2.27 per share, which would represent year-over-year growth of 26.82%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.08 billion, up 15.03% from the year-ago period.
MTH's full-year Zacks Consensus Estimates are calling for earnings of $9.17 per share and revenue of $4.24 billion. These results would represent year-over-year changes of +42.83% and +16.43%, respectively.
Investors should also note any recent changes to analyst estimates for MTH. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. MTH is currently a Zacks Rank #1 (Strong Buy).
Digging into valuation, MTH currently has a Forward P/E ratio of 10.99. Its industry sports an average Forward P/E of 11.86, so we one might conclude that MTH is trading at a discount comparatively.
Also, we should mention that MTH has a PEG ratio of 0.59. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. MTH's industry had an average PEG ratio of 1.4 as of yesterday's close.
The Building Products - Home Builders industry is part of the Construction sector. This industry currently has a Zacks Industry Rank of 4, which puts it in the top 2% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.