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Dec 31, 2019
Meritage Homes Q4 2019 Earnings Report
Meritage Homes reported strong Q4 2019 results with increased orders and diluted EPS.
Key Takeaways
Meritage Homes reported a strong fourth quarter in 2019, driven by a strategic shift to entry-level homes. Total orders increased by 27%, and diluted earnings per share increased by 39%. The company also improved its home closing gross margin and strengthened its balance sheet.
Total orders increased 27% year-over-year, driven by a 37% increase in absorptions.
Home closing revenue was up 11% due to a 13% increase in home closing volume.
Home closing gross margin improved 80 bps to 19.8%.
Net earnings increased 37% to $103.6 million, or $2.65 per diluted share.
Meritage Homes
Meritage Homes
Meritage Homes Revenue by Geographic Location
Revenue by Geographic Location
West Region Revenue
CapyFin.comCentral Region Revenue
CapyFin.comEast Region Revenue
CapyFin.com Forward Guidance
For the full year 2020, the company is projecting 9,700-10,200 total home closings and ASP’s between $360-370,000, with home closing gross margin in the mid-19’s percent and a tax rate of approximately 22%.
Positive Outlook
- Economic drivers remain positive for housing demand.
- Company's ability to deliver homes that provide great value at lower price points.
- Secured more than 18,000 new lots in 2019, expanding pipeline for community count growth.
- Positioned to deliver strong volume growth as communities are opened and begin selling.
- Believe we can grow earnings faster than our top-line growth in 2020.
Revenue & Expenses
Visualization of income flow from segment revenue to net income