Analyzing Meritage Corporation (MTH) and NVR (NVR)
Meritage Corporation (NYSE: MTH) and NVR (NYSE:NVR) are both construction companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, valuation, analyst recommendations, dividends, institutional ownership, risk and earnings.
Insider and Institutional Ownership
98.2% of Meritage Corporation shares are held by institutional investors. Comparatively, 79.8% of NVR shares are held by institutional investors. 5.6% of Meritage Corporation shares are held by company insiders. Comparatively, 11.3% of NVR shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
This is a breakdown of recent ratings and price targets for Meritage Corporation and NVR, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Meritage Corporation currently has a consensus target price of $40.29, indicating a potential downside of 1.50%. NVR has a consensus target price of $2,645.00, indicating a potential downside of 2.33%. Given Meritage Corporation’s higher probable upside, equities analysts plainly believe Meritage Corporation is more favorable than NVR.
This table compares Meritage Corporation and NVR’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation & Earnings
This table compares Meritage Corporation and NVR’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Meritage Corporation||$3.12 billion||0.53||$241.92 million||$3.64||11.24|
|NVR||$6.12 billion||1.66||$800.07 million||$126.57||21.40|
NVR has higher revenue and earnings than Meritage Corporation. Meritage Corporation is trading at a lower price-to-earnings ratio than NVR, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Meritage Corporation has a beta of 1.46, meaning that its share price is 46% more volatile than the S&P 500. Comparatively, NVR has a beta of 0.66, meaning that its share price is 34% less volatile than the S&P 500.
NVR beats Meritage Corporation on 10 of the 13 factors compared between the two stocks.
Meritage Corporation Company Profile
Meritage Homes Corporation operates as a holding company. The Company is a designer and builder of single-family homes. The Company operates through two segments: homebuilding and financial services. The homebuilding segment is engaged in the business of acquiring and developing land, constructing homes, marketing and selling those homes, and providing warranty and customer services. It builds homes in the regions of the United States and offers a range of homes that are designed for a range of homebuyers, including first-time, move-up, active adult and luxury. As of December 31, 2016, it had homebuilding operations in three regions: West, Central and East, which were consisted of nine states: Arizona, California, Colorado, Texas, Florida, Georgia, North Carolina, South Carolina and Tennessee. It also operates Carefree Title Agency, Inc. (Carefree Title) company. Carefree Title’s core business includes title insurance and closing/settlement services it offers to its homebuyers.
NVR Company Profile
NVR, Inc. is engaged in the construction and sale of single-family detached homes, townhomes and condominium buildings. The Company’s segments are Homebuilding Mid Atlantic, Homebuilding North East, Homebuilding Mid East, Homebuilding South East and Mortgage Banking. Its Homebuilding Mid Atlantic segment operates in various geographic regions, which include Maryland, Virginia, West Virginia, Delaware and Washington, District of Columbia (D.C.). Its Homebuilding North East segment operates in various geographic regions, which include New Jersey and Eastern Pennsylvania. Its Homebuilding Mid East segment operates in various geographic regions, which include New York, Ohio, Indiana and Illinois, The Homebuilding South East segment operates in various geographic regions, which include North Carolina, South Carolina, Florida and Tennessee. The Mortgage Banking segment provides mortgage-related services to home building customers through its mortgage banking operations.
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