Meritage Homes (NYSE:MTH) Downgraded to Sell Rating by Wall Street Zen

Key Points

• Wall Street Zen downgraded Meritage Homes (NYSE:MTH) from a "hold" to a sell rating in a report issued Saturday.
• Analyst coverage is mixed — two Strong Buy, four Buy, six Hold and one Sell — leaving a MarketBeat consensus of Moderate Buy with an average price target of $84.33.
• Meritage beat quarterly EPS estimates ($1.67 vs. $1.55) but revenue fell 11.9% year-over-year; the stock trades near $66.53 (market cap roughly $4.44B) and insiders have sold about 47,622 shares in the past 90 days while institutions own ~98.4%.

Meritage Homes (NYSE:MTH - Get Free Report) was downgraded by equities researchers at Wall Street Zen from a "hold" rating to a "sell" rating in a research report issued on Saturday.

Several other research analysts also recently commented on MTH. The Goldman Sachs Group reiterated a "buy" rating and set a $90.00 target price on shares of Meritage Homes in a research note on Tuesday, January 13th. Weiss Ratings reiterated a "hold (c)" rating on shares of Meritage Homes in a research note on Monday, December 29th. Citigroup assumed coverage on Meritage Homes in a research note on Wednesday, January 7th. They set an "outperform" rating for the company. Keefe, Bruyette & Woods reduced their target price on Meritage Homes from $78.00 to $76.00 and set a "market perform" rating for the company in a research note on Tuesday, February 3rd. Finally, Bank of America reiterated a "neutral" rating and set a $82.00 target price (up from $75.00) on shares of Meritage Homes in a research note on Friday, January 16th. Two equities research analysts have rated the stock with a Strong Buy rating, four have given a Buy rating, six have given a Hold rating and one has issued a Sell rating to the stock. According to data from MarketBeat.com, the company presently has a consensus rating of "Moderate Buy" and an average target price of $84.33.

Meritage Homes Stock Down 0.2%

MTH stock opened at $66.53 on Friday. The company has a quick ratio of 2.10, a current ratio of 2.10 and a debt-to-equity ratio of 0.35. The business has a 50 day moving average price of $69.12 and a two-hundred day moving average price of $69.78. The company has a market cap of $4.44 billion, a price-to-earnings ratio of 10.53, a P/E/G ratio of 1.18 and a beta of 1.50. Meritage Homes has a twelve month low of $58.03 and a twelve month high of $84.74.

Meritage Homes (NYSE:MTH - Get Free Report) last posted its quarterly earnings results on Wednesday, January 28th. The construction company reported $1.67 earnings per share for the quarter, beating analysts' consensus estimates of $1.55 by $0.12. The firm had revenue of $1.44 billion during the quarter, compared to the consensus estimate of $1.51 billion. Meritage Homes had a return on equity of 9.28% and a net margin of 7.73%.The business's revenue was down 11.9% compared to the same quarter last year. During the same period last year, the company earned $4.72 earnings per share. Analysts anticipate that Meritage Homes will post 9.44 EPS for the current fiscal year.

Insider Buying and Selling

In related news, EVP Javier Feliciano sold 3,580 shares of Meritage Homes stock in a transaction that occurred on Monday, February 23rd. The stock was sold at an average price of $76.24, for a total transaction of $272,939.20. Following the completion of the sale, the executive vice president directly owned 44,935 shares of the company's stock, valued at approximately $3,425,844.40. This trade represents a 7.38% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is accessible through the SEC website. Also, CFO Hilla Sferruzza sold 10,928 shares of Meritage Homes stock in a transaction that occurred on Monday, February 23rd. The stock was sold at an average price of $76.35, for a total value of $834,352.80. Following the sale, the chief financial officer directly owned 124,961 shares of the company's stock, valued at approximately $9,540,772.35. The trade was a 8.04% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last ninety days, insiders sold 47,622 shares of company stock valued at $3,640,273. Insiders own 2.20% of the company's stock.

Institutional Trading of Meritage Homes

Several hedge funds have recently added to or reduced their stakes in the company. Hsbc Holdings PLC lifted its holdings in Meritage Homes by 3,031.0% during the 4th quarter. Hsbc Holdings PLC now owns 92,741 shares of the construction company's stock worth $6,122,000 after purchasing an additional 89,779 shares during the last quarter. Corient Private Wealth LLC lifted its holdings in Meritage Homes by 6.6% during the 4th quarter. Corient Private Wealth LLC now owns 3,903 shares of the construction company's stock worth $257,000 after purchasing an additional 240 shares during the last quarter. Caitong International Asset Management Co. Ltd lifted its holdings in Meritage Homes by 996.6% during the 4th quarter. Caitong International Asset Management Co. Ltd now owns 2,873 shares of the construction company's stock worth $189,000 after purchasing an additional 2,611 shares during the last quarter. Virtu Financial LLC lifted its holdings in Meritage Homes by 81.5% during the 4th quarter. Virtu Financial LLC now owns 5,537 shares of the construction company's stock worth $364,000 after purchasing an additional 2,487 shares during the last quarter. Finally, Mercer Global Advisors Inc. ADV raised its holdings in Meritage Homes by 3.9% in the 4th quarter. Mercer Global Advisors Inc. ADV now owns 12,291 shares of the construction company's stock valued at $809,000 after acquiring an additional 466 shares in the last quarter. 98.44% of the stock is owned by institutional investors and hedge funds.

Meritage Homes Company Profile

Meritage Homes Corporation is a national homebuilder and residential developer headquartered in Scottsdale, Arizona. Founded in 1985 as Winchester Homes and later rebranded to Meritage Homes, the company specializes in designing, constructing and selling single‐family detached and attached homes. With a focus on energy efficiency and sustainable building practices, Meritage Homes markets its properties under the GreenSmart program, which integrates high‐performance features aimed at reducing long‐term energy and water consumption for homebuyers.

The company's core activities encompass land acquisition, residential community planning, home design, construction management and real estate sales.

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