Meritage Homes Corporation (MTH) AI Stock Analysis

Meritage Homes Corporation designs and builds single-family homes across the United States. Headquartered in Scottsdale, Arizona, the company operates via two primary segments: Homebuilding and Financial Services. In Homebuilding, it acquires land, develops properties, and builds residences targeted at first-time buyers and move-up purchasers. Operations span multiple states, including Texas, Arizona, California, Colorado, Florida, North Carolina, South Carolina, Georgia, and Tennessee. Its Financial Services segment offers title insurance and closing and settlement services. Established in 1985, Meritage Homes emphasizes energy-efficient residential construction under the Meritage Homes brand.

Between FY2020 and FY2025, revenue grew at a 5.4% compound annual rate, peaking at $6.40B in FY2024 before declining 8.4% to $5.86B in FY2025. Gross margin narrowed from 28.0% in FY2021 and 28.7% in FY2022 to 19.7% in FY2025, while operating margin compressed to 9.2%. Net income fell to $453.0M in FY2025, producing EPS of $6.48. For the trailing twelve months ended June 30, 2026, revenue stood at $5.39B with an operating margin of 8.2% and EPS of $4.79. In the latest quarter, quarterly revenue fell 13.8% year-over-year, and quarterly earnings declined 32.8%.

As of June 30, 2026, Meritage Homes held $807.3M in cash and short-term investments against total debt of $1.85B, resulting in net debt of $1.04B. Shareholders' equity was $5.06B, supported by a debt-to-equity ratio of 0.37 and a current ratio of 11.04. In FY2025, operating cash flow reached $118.3M, yielding $92.6M in free cash flow after capital expenditures of $25.7M. Capital allocation in FY2025 included $295.0M directed toward share buybacks and $121.1M paid in dividends, contributing to a 12.4% reduction in share count over five years.

MTH trades at a trailing price-to-earnings multiple of 12.4x and a forward P/E of 12.5x, below the median of its US-listed Consumer Cyclical peers of 18.0x and 14.1x, respectively. Its enterprise value to EBITDA ratio stands at 12.0x compared to the peer median of 11.1x, while price-to-book is 0.9x. The stock has a PEG ratio of 0.54 and closed at $59.17 on October 16, 2026. Over the trailing 1-year period, MTH declined 12.8%, lagging the 16.8% return of the S&P 500 (SPY), and its 5-year return of 25.2% trails SPY's 83.0% gain.

Meritage Homes pays an annual forward dividend of $1.92, offering a 3.24% dividend yield as of October 16, 2026. The payout ratio stands at 37.2%. The dividend is distributed on a quarterly frequency, and the company has paid dividends for 4 consecutive years, with the latest ex-dividend date on September 15, 2026.

Wall Street coverage consists of 3 Strong Buy, 1 Buy, and 5 Hold ratings, with no Sell ratings. The mean price target of $75.22 implies 27.1% upside from the last close of $59.17. For the fiscal year ending December 31, 2026, analysts expect revenue of $5.34B and EPS of $4.84, representing a 23.8% earnings decline. In FY2027, 7 analysts project revenue to rebound 6.5% to $5.69B with EPS rising 15.6% to $5.59. The company beat EPS estimates in 1 of the last 4 quarters, and its next earnings date is October 28, 2026.

This page is an AI-written research summary of Meritage Homes Corporation (MTH). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

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