The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Meritage Homes met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly and GAAP earnings per share expanded.
Margins grew across the board.
Meritage Homes notched revenue of $342.6 million. The 12 analysts polled by S&P Capital IQ expected revenue of $344.0 million on the same basis. GAAP reported sales were 58% higher than the prior-year quarter's $217.5 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.45. The 10 earnings estimates compiled by S&P Capital IQ averaged $0.32 per share. GAAP EPS were $0.19 for Q3 against -$0.10 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 18.2%, 70 basis points better than the prior-year quarter. Operating margin was 5.1%, 420 basis points better than the prior-year quarter. Net margin was 2.0%, 350 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $350.7 million. On the bottom line, the average EPS estimate is $0.41.
Next year's average estimate for revenue is $1.18 billion. The average EPS estimate is $0.79.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Meritage Homes is hold, with an average price target of $35.70.
- Add Meritage Homes to My Watchlist.
Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend Meritage Homes. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.