Homebuilder Meritage Homes (NYSE: MTH) will be reporting earnings this Wednesday afternoon. Here’s what to expect.
Meritage Homes missed analysts’ revenue expectations last quarter, reporting revenues of $1.12 billion, down 17.7% year on year. It was a disappointing quarter for the company, with a significant miss of analysts’ EPS estimates.
Is Meritage Homes a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Meritage Homes’s revenue to decline 13% year on year, a further deceleration from the 4% decrease it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Meritage Homes has missed Wall Street’s revenue estimates multiple times over the last two years.
Looking at Meritage Homes’s peers in the home builders segment, some have already reported their Q2 results, giving us a hint as to what we can expect. PulteGroup’s revenues decreased 9.6% year on year, beating analysts’ expectations by 1.1%, and KB Home reported a revenue decline of 27.3%, topping estimates by 1.8%. PulteGroup’s stock price was unchanged after the results and KB Home’s price followed a similar reaction.
Read our full analysis of PulteGroup’s results here and KB Home’s results here.
In the last twelve months or so, the market has shifted its attention from one area of macro importance to the next (AI disintermediation and AI capex spending to geopolitical conflict, rates, and whether the economy is on solid footing or not). While some of the home builders stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 3.3% on average over the last month. Meritage Homes is down 13% during the same time and is heading into earnings with an average analyst price target of $81.63 (compared to the current share price of $73.37).
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