Meritage Homes (MTH) Sees a More Significant Dip Than Broader Market: Some Facts to Know

The most recent trading session ended with Meritage Homes (MTH) standing at $165.43, reflecting a -0.41% shift from the previouse trading day's closing. The stock fell short of the S&P 500, which registered a loss of 0.07% for the day. Meanwhile, the Dow experienced a rise of 0.16%, and the technology-dominated Nasdaq saw a decrease of 0.36%.

The homebuilder's shares have seen a decrease of 5.27% over the last month, not keeping up with the Construction sector's loss of 1.36% and the S&P 500's gain of 3.05%.

Analysts and investors alike will be keeping a close eye on the performance of Meritage Homes in its upcoming earnings disclosure. The company's earnings report is set to go public on January 31, 2024. It is anticipated that the company will report an EPS of $5.18, marking a 26.94% fall compared to the same quarter of the previous year. Meanwhile, the latest consensus estimate predicts the revenue to be $1.52 billion, indicating a 23.54% decrease compared to the same quarter of the previous year.

Investors might also notice recent changes to analyst estimates for Meritage Homes. These revisions help to show the ever-changing nature of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.24% downward. Meritage Homes is currently a Zacks Rank #3 (Hold).

Looking at its valuation, Meritage Homes is holding a Forward P/E ratio of 8.51. This expresses a discount compared to the average Forward P/E of 9.72 of its industry.

The Building Products - Home Builders industry is part of the Construction sector. Currently, this industry holds a Zacks Industry Rank of 25, positioning it in the top 10% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.

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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 Nasdaq, Inc.

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