Meritage Homes (NYSE:MTH) Shares Gap Down – Should You Sell?

Meritage Homes Co. (NYSE:MTH)’s stock price gapped down before the market opened on Thursday . The stock had previously closed at $156.33, but opened at $151.94. Meritage Homes shares last traded at $152.91, with a volume of 63,368 shares trading hands.

Wall Street Analysts Forecast Growth

A number of research firms recently weighed in on MTH. JPMorgan Chase & Co. reaffirmed a “neutral” rating and issued a $197.00 price target (down previously from $220.00) on shares of Meritage Homes in a report on Friday, December 13th. Wedbush raised shares of Meritage Homes from an “underperform” rating to a “neutral” rating and lifted their target price for the stock from $160.00 to $195.00 in a research note on Tuesday, October 15th. The Goldman Sachs Group raised Meritage Homes from a “neutral” rating to a “buy” rating and increased their price target for the company from $205.00 to $235.00 in a report on Thursday, October 31st. Raymond James downgraded shares of Meritage Homes from an “outperform” rating to a “market perform” rating in a research note on Thursday, November 7th. Finally, StockNews.com cut shares of Meritage Homes from a “hold” rating to a “sell” rating in a research note on Friday, December 13th. One analyst has rated the stock with a sell rating, five have given a hold rating and four have given a buy rating to the company’s stock. Based on data from MarketBeat.com, Meritage Homes presently has an average rating of “Hold” and an average target price of $215.14.

Meritage Homes Price Performance

The company has a market cap of $5.48 billion, a price-to-earnings ratio of 6.86 and a beta of 1.82. The company’s 50 day moving average price is $184.76 and its 200 day moving average price is $184.67. The company has a current ratio of 1.75, a quick ratio of 1.75 and a debt-to-equity ratio of 0.26.

Meritage Homes’s stock is going to split before the market opens on Friday, January 3rd. The 2-1 split was announced on Monday, November 25th. The newly created shares will be distributed to shareholders after the market closes on Tuesday, December 31st.

Meritage Homes (NYSE:MTH) last announced its quarterly earnings results on Tuesday, October 29th. The construction company reported $5.34 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $5.05 by $0.29. Meritage Homes had a net margin of 12.63% and a return on equity of 16.89%. The business had revenue of $1.59 billion during the quarter, compared to the consensus estimate of $1.58 billion. During the same quarter last year, the firm posted $5.98 EPS. The business’s revenue was down 1.5% compared to the same quarter last year. Equities research analysts forecast that Meritage Homes Co. will post 21.27 earnings per share for the current year.

Meritage Homes Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Tuesday, December 31st. Investors of record on Tuesday, December 17th will be issued a dividend of $0.75 per share. The ex-dividend date is Tuesday, December 17th. This represents a $3.00 annualized dividend and a yield of 1.98%. Meritage Homes’s dividend payout ratio is presently 13.58%.

Institutional Trading of Meritage Homes

Several large investors have recently bought and sold shares of MTH. State Street Corp increased its holdings in Meritage Homes by 4.4% during the 3rd quarter. State Street Corp now owns 1,773,609 shares of the construction company’s stock valued at $363,714,000 after acquiring an additional 74,422 shares in the last quarter. Earnest Partners LLC grew its position in shares of Meritage Homes by 2.5% in the second quarter. Earnest Partners LLC now owns 718,607 shares of the construction company’s stock valued at $116,307,000 after purchasing an additional 17,843 shares during the last quarter. Charles Schwab Investment Management Inc. increased its stake in shares of Meritage Homes by 1.2% during the 3rd quarter. Charles Schwab Investment Management Inc. now owns 489,035 shares of the construction company’s stock worth $100,286,000 after purchasing an additional 5,732 shares in the last quarter. Westfield Capital Management Co. LP raised its position in shares of Meritage Homes by 26.9% during the 3rd quarter. Westfield Capital Management Co. LP now owns 483,159 shares of the construction company’s stock worth $99,081,000 after purchasing an additional 102,502 shares during the last quarter. Finally, FMR LLC raised its position in shares of Meritage Homes by 75.1% during the 3rd quarter. FMR LLC now owns 347,227 shares of the construction company’s stock worth $71,206,000 after purchasing an additional 148,898 shares during the last quarter. Institutional investors and hedge funds own 98.44% of the company’s stock.

Meritage Homes Company Profile

Meritage Homes Corporation, together with its subsidiaries, designs and builds single-family attached and detached homes in the United States. The company operates through two segments, Homebuilding and Financial Services. It acquires and develops land; and constructs, markets, and sells homes for entry-level and first move-up buyers in Arizona, California, Colorado, Utah, Texas, Florida, Georgia, North Carolina, South Carolina, and Tennessee.