Meritage Homes (NYSE:MTH) Stock Rating Lowered by Wolfe Research

Key Points

• Wolfe Research downgraded Meritage Homes from “strong buy” to “hold,” contributing to an overall analyst consensus of “Hold” with a $72.78 target price.
• Analyst opinions remain mixed: four analysts rate the stock a Buy, eight a Hold and two a Sell, with targets ranging from $59 to $88.
• Meritage Homes reported weaker-than-expected quarterly results, including adjusted EPS of $1.11 versus $1.17 expected and revenue of $1.18 billion versus $1.29 billion; revenue fell 17.5% year over year.

Meritage Homes (NYSE:MTH - Get Free Report) was downgraded by equities researchers at Wolfe Research from a "strong-buy" rating to a "hold" rating in a research report issued to clients and investors on Friday, Zacks reports.

Several other analysts have also recently commented on MTH. Weiss Ratings cut Meritage Homes from a "hold (c+)" rating to a "hold (c)" rating in a report on Friday, September 18th. Melius Research initiated coverage on shares of Meritage Homes in a research report on Tuesday, October 6th. They set a "sell" rating and a $59.00 price target for the company. Zacks Research downgraded shares of Meritage Homes from a "hold" rating to a "strong sell" rating in a research note on Thursday, October 8th. The Goldman Sachs Group set a $82.00 price target on shares of Meritage Homes and gave the company a "buy" rating in a report on Monday, October 12th. Finally, UBS Group reissued a "buy" rating and set a $88.00 price objective (up from $86.00) on shares of Meritage Homes in a research note on Friday, July 31st. Four equities research analysts have rated the stock with a Buy rating, eight have assigned a Hold rating and two have given a Sell rating to the company's stock. According to data from MarketBeat.com, Meritage Homes currently has an average rating of "Hold" and a consensus target price of $72.78.

Meritage Homes Price Performance

Meritage Homes stock opened at $64.39 on Friday. Meritage Homes has a 12-month low of $56.66 and a 12-month high of $85.38. The stock has a market capitalization of $4.20 billion, a P/E ratio of 14.54, a P/E/G ratio of 4.83 and a beta of 1.33. The firm's 50-day moving average is $64.29 and its two-hundred day moving average is $69.02. The company has a debt-to-equity ratio of 0.37, a current ratio of 1.72 and a quick ratio of 1.97.

Meritage Homes (NYSE:MTH - Get Free Report) last announced its quarterly earnings data on Wednesday, October 28th. The construction company reported $1.11 EPS for the quarter, missing analysts' consensus estimates of $1.17 by ($0.06). The business had revenue of $1.18 billion during the quarter, compared to analysts' expectations of $1.29 billion. Meritage Homes had a net margin of 5.79% and a return on equity of 6.69%. Meritage Homes's revenue for the quarter was down 17.5% on a year-over-year basis. During the same period in the prior year, the firm earned $1.39 EPS. Equities analysts predict that Meritage Homes will post 4.93 earnings per share for the current year.

Hedge Funds Weigh In On Meritage Homes

Hedge funds and other institutional investors have recently added to or reduced their stakes in the company. Ceredex Value Advisors LLC purchased a new position in Meritage Homes in the 2nd quarter worth approximately $12,540,000. Empowered Funds LLC bought a new stake in Meritage Homes in the second quarter worth $2,207,000. Weiss Asset Management LP bought a new stake in Meritage Homes in the first quarter worth $916,000. The Manufacturers Life Insurance Company purchased a new stake in Meritage Homes during the second quarter valued at about $2,953,000. Finally, D L Carlson Investment Group Inc. purchased a new stake in Meritage Homes during the second quarter valued at about $3,014,000. Institutional investors and hedge funds own 98.44% of the company's stock.

Meritage Homes Company Profile

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 homebuyers, offering homes in a range of floor plans and communities designed around affordability, energy efficiency and modern features.

Meritage Homes sells homes through its own communities and provides related services, including land acquisition and development, home design, construction, sales and customer support.

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