Meritage Homes (NYSE:MTH) Stock Rated Sell in New Coverage at Melius Research

Key Points

• Melius Research initiated coverage of Meritage Homes with a Sell rating and a $59 price target, implying approximately 5.46% downside from the stock’s cited price of $62.41.
• Analyst sentiment is mixed but leans toward caution: four analysts rate the stock Buy, eight rate it Hold, and one rates it Sell. The consensus rating is Hold, with an average price target of $74.78.
• Meritage Homes beat quarterly EPS estimates ($1.42 versus $1.30) but reported a 14.1% year-over-year revenue decline; institutional investors own 98.44% of the company’s shares.

Equities researchers at Melius Research began coverage on shares of Meritage Homes (NYSE:MTH - Get Free Report) in a note issued to investors on Tuesday, Briefing.com reports. The firm set a "sell" rating and a $59.00 price target on the construction company's stock. Melius Research's price target suggests a potential downside of 5.46% from the company's current price.

A number of other equities analysts also recently weighed in on MTH. Truist Financial set a $72.00 price target on shares of Meritage Homes and gave the stock a "hold" rating in a research note on Wednesday, September 16th. Zelman & Associates downgraded shares of Meritage Homes from an "outperform" rating to a "neutral" rating in a research note on Tuesday, July 7th. Evercore set a $65.00 price target on Meritage Homes in a report on Friday, September 25th. Zacks Research upgraded shares of Meritage Homes from a "strong sell" rating to a "hold" rating in a research note on Monday, July 13th. Finally, The Goldman Sachs Group reiterated a "buy" rating and issued a $93.00 price target (up from $82.00) on shares of Meritage Homes in a research note on Friday, July 10th. Four analysts have rated the stock with a Buy rating, eight have assigned a Hold rating and one has issued a Sell rating to the company. Based on data from MarketBeat.com, the stock has an average rating of "Hold" and a consensus price target of $74.78.

Meritage Homes Price Performance

MTH stock opened at $62.41 on Tuesday. The firm has a 50 day moving average of $68.61 and a 200-day moving average of $68.86. The company has a market cap of $4.07 billion, a price-to-earnings ratio of 13.06, a PEG ratio of 4.70 and a beta of 1.33. The company has a current ratio of 1.97, a quick ratio of 1.97 and a debt-to-equity ratio of 0.37. Meritage Homes has a 12-month low of $58.03 and a 12-month high of $85.38.

Meritage Homes (NYSE:MTH - Get Free Report) last released its quarterly earnings data on Wednesday, July 29th. The construction company reported $1.42 earnings per share for the quarter, beating the consensus estimate of $1.30 by $0.12. Meritage Homes had a return on equity of 7.13% and a net margin of 6.11%.The firm had revenue of $1.41 billion during the quarter, compared to the consensus estimate of $1.43 billion. During the same period last year, the business posted $2.04 EPS. Meritage Homes's quarterly revenue was down 14.1% on a year-over-year basis. As a group, equities analysts expect that Meritage Homes will post 5.02 EPS for the current fiscal year.

Institutional Investors Weigh In On Meritage Homes

Several large investors have recently made changes to their positions in MTH. Ceredex Value Advisors LLC bought a new position in Meritage Homes during the second quarter worth $12,540,000. Empowered Funds LLC acquired a new stake in Meritage Homes during the 2nd quarter worth about $2,207,000. Weiss Asset Management LP acquired a new stake in Meritage Homes during the 1st quarter worth about $916,000. The Manufacturers Life Insurance Company bought a new position in shares of Meritage Homes in the 2nd quarter worth about $2,953,000. Finally, iA Global Asset Management Inc. bought a new position in shares of Meritage Homes in the 1st quarter worth about $6,650,000. Institutional investors and hedge funds own 98.44% of the company's stock.

About Meritage Homes

Meritage Homes Corporation is a residential construction company that designs and builds single-family homes in the United States. The company primarily serves entry-level and first-time move-up buyers, offering homes in a range of floor plans, sizes and price points. Its communities typically feature energy-efficient designs and include standard features intended to improve home performance, comfort and affordability.

Meritage Homes develops communities in selected markets across the South, Southeast and West, including areas of Arizona, California, Colorado, Florida, Georgia, North Carolina, South Carolina, Tennessee and Texas.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.