Homebuilder Meritage Homes (NYSE: MTH) will be reporting earnings this Wednesday after the bell. Here’s what to look for.
Meritage Homes missed analysts’ revenue expectations last quarter, reporting revenues of $1.44 billion, down 11.5% year on year. It was a disappointing quarter for the company, with a significant miss of analysts’ revenue estimates and a significant miss of analysts’ adjusted operating income 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 14.4% year on year, a further deceleration from the 7.5% decrease it recorded in the same quarter last year.
The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to 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 industrials segment, some have already reported their Q1 results, giving us a hint as to what we can expect. KB Home’s revenues decreased 22.6% year on year, missing analysts’ expectations by 1.8%, and Lennar reported a revenue decline of 13.3%, falling short of estimates by 4.5%. KB Home traded down 1.5% following the results while Lennar was up 2.6%.
Read our full analysis of KB Home’s results here and Lennar’s results here.
There has been positive sentiment among investors in the industrials segment, with share prices up 11.6% on average over the last month. Meritage Homes is up 13.2% during the same time and is heading into earnings with an average analyst price target of $79.22 (compared to the current share price of $69.43).
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