M/I Homes (NYSE:MHO) Posts Earnings Results, Beats Estimates By $0.01 EPS

Key Points

• M/I Homes beat quarterly estimates, reporting $3.14 in EPS versus the $3.13 consensus and $1.06 billion in revenue versus expectations of $1.05 billion. However, revenue fell 6% year over year, while EPS declined from $4.42.
• New contracts increased 15% year over year to a record 2,387 homes, despite elevated mortgage rates. Gross margin remained solid at 22.1%, though mortgage-rate buydown costs and affordability pressures continue to weigh on demand.
• The company maintained a strong balance sheet with $736 million in cash, no revolver borrowings and 18% debt-to-capital, while repurchasing $50 million of stock. Shares rose about 2%, and analysts’ consensus rating remained Moderate Buy with a $161.67 average price target.

M/I Homes (NYSE:MHO - Get Free Report) released its quarterly earnings results on Wednesday. The construction company reported $3.14 EPS for the quarter, beating analysts' consensus estimates of $3.13 by $0.01, FiscalAI reports. The firm had revenue of $1.06 billion during the quarter, compared to analyst estimates of $1.05 billion. M/I Homes had a net margin of 8.24% and a return on equity of 12.91%. The business's revenue for the quarter was down 6.0% on a year-over-year basis. During the same period in the previous year, the business earned $4.42 EPS.

Here are the key takeaways from M/I Homes' conference call:

• Second-quarter new contracts rose 15% year over year to a record 2,387 homes, with the sales pace improving to 3.4 homes per community despite elevated mortgage rates and economic uncertainty.
• Revenue fell 9% and diluted earnings per share declined to $3.02 from $4.42 a year ago, while deliveries decreased 6% and SG&A rose to 12.6% of revenue.
• Gross margin was a solid 22.1%, or 22.5% excluding $4 million in inventory charges, supported by modest construction-cost improvements and pricing in select communities; however, mortgage-rate buydown costs increased and remain important to sustaining demand.
• The company ended the quarter with a strong balance sheet, including $736 million in cash, no revolver borrowings, 18% debt-to-capital, and an S&P credit-rating upgrade to BB+; it also repurchased $50 million of stock during the quarter.
• Management remains bullish on most markets and expects 2026 average community count to grow about 5%, but identified Tampa and Sarasota as challenged and noted continued uncertainty from interest rates, affordability, consumer confidence, and geopolitical conditions.

M/I Homes Trading Up 2.0%

Shares of M/I Homes stock traded up $3.04 during midday trading on Wednesday, reaching $155.18. 140,952 shares of the company's stock traded hands, compared to its average volume of 245,343. The stock has a 50 day moving average of $145.14 and a 200-day moving average of $136.84. M/I Homes has a 12 month low of $116.78 and a 12 month high of $163.66. The company has a market cap of $3.97 billion, a PE ratio of 11.66 and a beta of 1.60. The company has a debt-to-equity ratio of 0.30, a quick ratio of 1.95 and a current ratio of 8.40.

Analyst Ratings Changes

Several research firms recently issued reports on MHO. Zacks Research raised M/I Homes from a "strong sell" rating to a "hold" rating in a research note on Friday, June 26th. Seaport Research Partners restated a "neutral" rating on shares of M/I Homes in a research note on Tuesday, April 7th. Zelman & Associates cut M/I Homes from an "outperform" rating to a "neutral" rating in a report on Tuesday, July 7th. Freedom Capital upgraded M/I Homes to a "strong-buy" rating in a research report on Wednesday, June 24th. Finally, Weiss Ratings reissued a "hold (c)" rating on shares of M/I Homes in a report on Friday, May 15th. Two research analysts have rated the stock with a Strong Buy rating, two have issued a Buy rating and three have issued a Hold rating to the stock. According to data from MarketBeat, the stock presently has a consensus rating of "Moderate Buy" and an average target price of $161.67.

Institutional Inflows and Outflows

Several institutional investors have recently made changes to their positions in MHO. WealthCollab LLC grew its holdings in M/I Homes by 16.5% in the second quarter. WealthCollab LLC now owns 614 shares of the construction company's stock worth $69,000 after purchasing an additional 87 shares during the period. Private Advisor Group LLC boosted its position in shares of M/I Homes by 3.0% in the 3rd quarter. Private Advisor Group LLC now owns 3,027 shares of the construction company's stock worth $437,000 after purchasing an additional 89 shares in the last quarter. Smartleaf Asset Management LLC grew its stake in shares of M/I Homes by 15.9% in the 2nd quarter. Smartleaf Asset Management LLC now owns 876 shares of the construction company's stock worth $99,000 after buying an additional 120 shares during the last quarter. EverSource Wealth Advisors LLC grew its stake in shares of M/I Homes by 90.6% in the 2nd quarter. EverSource Wealth Advisors LLC now owns 284 shares of the construction company's stock worth $32,000 after buying an additional 135 shares during the last quarter. Finally, CIBC Private Wealth Group LLC increased its position in M/I Homes by 53.7% during the 3rd quarter. CIBC Private Wealth Group LLC now owns 475 shares of the construction company's stock valued at $69,000 after buying an additional 166 shares in the last quarter. Institutional investors own 95.14% of the company's stock.

M/I Homes Company Profile

M/I Homes, Inc is a publicly traded residential homebuilder founded in 1976 and headquartered in Columbus, Ohio. The company designs, markets and constructs single-family homes and townhome communities across the United States, offering a range of floor plans with customizable design options. Its product portfolio includes starter homes, move-up homes and luxury models, as well as multi-family residences in urban and suburban infill locations.

In addition to its core homebuilding operations, M/I Homes provides mortgage, title and closing services through its in-house affiliate M/I Financial Services.

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