Back to top

Image: Bigstock

Meritage Homes (MTH) Stock Sinks As Market Gains: What You Should Know

Read MoreHide Full Article

Meritage Homes (MTH - Free Report) closed at $130.18 in the latest trading session, marking a -1.98% move from the prior day. This change lagged the S&P 500's daily gain of 0.12%. At the same time, the Dow lost 0.2%, and the tech-heavy Nasdaq gained 0.29%.

Coming into today, shares of the homebuilder had lost 9.34% in the past month. In that same time, the Construction sector lost 3.92%, while the S&P 500 gained 0.09%.

Investors will be hoping for strength from Meritage Homes as it approaches its next earnings release. On that day, Meritage Homes is projected to report earnings of $5.11 per share, which would represent a year-over-year decline of 28.03%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.55 billion, down 1.64% from the year-ago period.

MTH's full-year Zacks Consensus Estimates are calling for earnings of $19.45 per share and revenue of $6.07 billion. These results would represent year-over-year changes of -27.26% and -3.17%, respectively.

Any recent changes to analyst estimates for Meritage Homes should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Meritage Homes is currently sporting a Zacks Rank of #1 (Strong Buy).

Investors should also note Meritage Homes's current valuation metrics, including its Forward P/E ratio of 6.83. This represents a discount compared to its industry's average Forward P/E of 8.64.

The Building Products - Home Builders industry is part of the Construction sector. This group has a Zacks Industry Rank of 3, putting it in the top 2% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

Be sure to follow all of these stock-moving metrics, and many more, on

See More Zacks Research for These Tickers

Normally $25 each - click below to receive one report FREE:

Meritage Homes Corporation (MTH) - free report >>

Published in