Meritage Homes (NYSE:MTH) Share Price Crosses Below Two Hundred Day Moving Average - Should You Sell?

Key Points

• Meritage Homes fell below its 200-day moving average, trading as low as $66.95 versus the $68.92 average and last changing hands at $67.13.
• Analyst sentiment is mixed but averages to Hold: four Buy, eight Hold and two Sell ratings, with a consensus price target of $72.44.
• The latest quarter missed expectations, with EPS of $1.11 versus $1.17 forecast and revenue of $1.18 billion versus $1.29 billion expected; revenue was down 17.5% year over year. The company’s annualized dividend is $1.92, a 2.9% yield.

Meritage Homes Corporation (NYSE:MTH - Get Free Report) crossed below its 200-day moving average during trading on Tuesday. The stock has a 200-day moving average of $68.92 and traded as low as $66.95. Meritage Homes shares last traded at $67.1290, with a volume of 1,897,985 shares trading hands.

Analyst Ratings Changes

A number of equities analysts have issued reports on the stock. Weiss Ratings downgraded shares of Meritage Homes from a "hold (c)" rating to a "hold (c-)" rating in a report on Monday. The Goldman Sachs Group set a $82.00 target price on shares of Meritage Homes and gave the company a "buy" rating in a report on Monday, October 12th. Wolfe Research lowered shares of Meritage Homes from a "strong-buy" rating to a "hold" rating in a research report on Friday, October 30th. Melius Research initiated coverage on shares of Meritage Homes in a report on Tuesday, October 6th. They set a "sell" rating and a $59.00 price target on the stock. Finally, Zelman & Associates cut shares of Meritage Homes from an "outperform" rating to a "neutral" rating in a report on Tuesday, July 7th. Four 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 MarketBeat, the company has an average rating of "Hold" and a consensus price target of $72.44.

Meritage Homes Stock Performance

The firm has a market cap of $4.32 billion, a PE ratio of 15.15, a PEG ratio of 5.24 and a beta of 1.31. The company has a quick ratio of 1.97, a current ratio of 1.72 and a debt-to-equity ratio of 0.37. The company has a 50-day simple moving average of $64.12 and a two-hundred day simple moving average of $68.92.

Meritage Homes (NYSE:MTH - Get Free Report) last announced its earnings results on Wednesday, October 28th. The construction company reported $1.11 earnings per share (EPS) for the quarter, missing the consensus estimate of $1.17 by ($0.06). The business had revenue of $1.18 billion for 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%. The company's revenue for the quarter was down 17.5% compared to the same quarter last year. During the same period in the prior year, the business earned $1.39 earnings per share. As a group, equities research analysts forecast that Meritage Homes Corporation will post 4.86 earnings per share for the current year.

Meritage Homes Announces Dividend

The company also recently disclosed a quarterly dividend, which was paid on Wednesday, September 30th. Investors of record on Tuesday, September 15th were paid a $0.48 dividend. The ex-dividend date was Tuesday, September 15th. This represents a $1.92 annualized dividend and a yield of 2.9%. Meritage Homes's dividend payout ratio is presently 43.34%.

Hedge Funds Weigh In On Meritage Homes

Several institutional investors and hedge funds have recently bought and sold shares of MTH. Bamco Inc. NY bought a new stake in Meritage Homes during the 2nd quarter valued at $112,498,000. Bank of New York Mellon Corp bought a new position in shares of Meritage Homes in the second quarter worth $68,873,000. Algert Global LLC boosted its holdings in shares of Meritage Homes by 267.8% in the second quarter. Algert Global LLC now owns 356,121 shares of the construction company's stock worth $29,861,000 after acquiring an additional 259,291 shares during the period. SummitTX Capital L.P. boosted its holdings in shares of Meritage Homes by 16.1% in the first quarter. SummitTX Capital L.P. now owns 471,614 shares of the construction company's stock worth $29,165,000 after acquiring an additional 65,540 shares during the period. Finally, Atlas FRM LLC purchased a new position in shares of Meritage Homes in the second quarter valued at $18,447,000. 98.44% of the stock is owned by institutional investors.

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 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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