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

Shares of Meritage Homes Co. (NYSE:MTH) gapped down prior to trading 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.

Wall Street Analysts Forecast Growth

MTH has been the topic of a number of recent research reports. Wedbush raised shares of Meritage Homes from an “underperform” rating to a “neutral” rating and upped their target price for the stock from $160.00 to $195.00 in a research report on Tuesday, October 15th. The Goldman Sachs Group raised Meritage Homes from a “neutral” rating to a “buy” rating and lifted their price target for the stock from $205.00 to $235.00 in a research report on Thursday, October 31st. JPMorgan Chase & Co. reiterated a “neutral” rating and set a $197.00 price target (down previously from $220.00) on shares of Meritage Homes in a report on Friday, December 13th. Raymond James cut Meritage Homes from an “outperform” rating to a “market perform” rating in a research report on Thursday, November 7th. Finally, Keefe, Bruyette & Woods lowered their target price on shares of Meritage Homes from $210.00 to $198.00 and set a “market perform” rating on the stock in a research note on Tuesday, November 5th. One analyst has rated the stock with a sell rating, five have assigned a hold rating and four have issued a buy rating to the company’s stock. According to MarketBeat, the stock currently has an average rating of “Hold” and a consensus target price of $215.14.

Meritage Homes Trading Down 3.1 %

The company has a debt-to-equity ratio of 0.26, a current ratio of 1.75 and a quick ratio of 1.75. The stock has a market cap of $5.48 billion, a PE ratio of 6.86 and a beta of 1.82. The stock has a 50-day moving average price of $184.76 and a two-hundred day moving average price of $184.67.

Shares of Meritage Homes are set to split on the morning of Friday, January 3rd. The 2-1 split was announced on Monday, November 25th. The newly minted shares will be distributed to shareholders after the market closes on Tuesday, December 31st.

Meritage Homes (NYSE:MTH) last issued its quarterly earnings data on Tuesday, October 29th. The construction company reported $5.34 earnings per share for the quarter, topping the consensus estimate of $5.05 by $0.29. The company had revenue of $1.59 billion for the quarter, compared to analysts’ expectations of $1.58 billion. Meritage Homes had a return on equity of 16.89% and a net margin of 12.63%. The firm’s revenue for the quarter was down 1.5% on a year-over-year basis. During the same period in the previous year, the firm posted $5.98 earnings per share. Sell-side analysts forecast that Meritage Homes Co. will post 21.27 earnings per share for the current fiscal year.

Meritage Homes Announces Dividend

The company also recently declared 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 of this dividend is Tuesday, December 17th. This represents a $3.00 annualized dividend and a yield of 1.98%. Meritage Homes’s payout ratio is 13.58%.

Hedge Funds Weigh In On Meritage Homes

Institutional investors have recently modified their holdings of the stock. Wedge Capital Management L L P NC boosted its holdings in Meritage Homes by 734.4% in the third quarter. Wedge Capital Management L L P NC now owns 272,122 shares of the construction company’s stock worth $55,804,000 after acquiring an additional 239,511 shares in the last quarter. Healthcare of Ontario Pension Plan Trust Fund purchased a new stake in Meritage Homes in the third quarter valued at approximately $44,029,000. Point72 Asset Management L.P. acquired a new position in Meritage Homes in the 3rd quarter worth approximately $36,365,000. FMR LLC lifted its stake in Meritage Homes by 75.1% during the 3rd quarter. FMR LLC now owns 347,227 shares of the construction company’s stock valued at $71,206,000 after acquiring an additional 148,898 shares during the period. Finally, Mizuho Markets Americas LLC acquired a new position in shares of Meritage Homes in the 2nd quarter valued at about $22,887,000. 98.44% of the stock is owned by hedge funds and other institutional investors.

About Meritage Homes

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.