Meritage Reports Q4 Prelim Results - Analyst Blog

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Meritage Homes Corporation 's ( MTH ) recently revealed preliminary fourth quarter and fiscal year 2013 numbers, which is scheduled to release on Feb 5. The company expects double-digit increase in home closing revenues; number of homes closed, net order and order value during the quarter. The company also expects significant increase in home closing gross margin.

Fourth Quarter 2013

Meritage's home closing revenues in the fourth quarter of 2013 is expected to be around $533 million, up 47.0% year over year. Year-over-year growth in home closing revenues is expected to be driven by an 18% increase in the number of homes closed and a hike in average closing prices. The company is expected to close 1,468 home during the quarter.

Meritage expects total order value of about $415 million in the quarter, up 17% from the prior year quarter. Net orders during the quarter are expected to total 1,131 homes, up 3% year over year. Monthly orders and order value is expected to increase sequentially.

The company expects backlog of 1,853 units as of Dec 31, 2013, up 26%. Total value of the backlog is expected to be about $687 million, up 43% year over year.

During the fourth quarter of 2013, the company expects 400 to 425 basis points increase in home closing gross margin.  

Fiscal 2013

Meritage's home closing revenues in fiscal 2013 are expected to be about $1.78 billion, up 51.0% year over year. Year-over-year growth in home closing revenues is expected to be driven by a 24% increase in the number of homes closed and a hike in average closing prices. The company is likely to close 5,259 home during the year.

Meritage expects total order value of $1.98 billion in 2013, up 40% from the prior year. Net order during 2013 is likely to be 5,615 homes, up 17% year over year.

The company has been witnessing strong top-line growth and margin expansion. However, the sales pace of the company has slowed down owing to headwinds like recent spike in mortgage rates, rising home prices, tight credit availability and the political uncertainty in Washington.

Meritage Homes Corporation currently carries a Zacks Rank #4 (Sell).

However, some better-ranked stocks in the homebuilding sector include Beazer Homes USA Inc. ( BZH ), William Lyon Homes ( WLH ) and Standard Pacific Corp. ( SPF ). While Beazer Homes and William Lyon Homes carry a Zacks Rank #1 (Strong Buy), Standard Pacific carries a Zacks Rank #2 (Buy).



BEAZER HOMES (BZH): Free Stock Analysis Report

MERITAGE HOMES (MTH): Free Stock Analysis Report

STANDARD PAC (SPF): Free Stock Analysis Report

WILLIAM LYON HM (WLH): Get Free Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: BZH , MTH , SPF , WLH

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