Meritage (MTH) Surges 10.1%: Is This an Indication of Further Gains?
Meritage Homes (MTH) shares soared 10.1% in the last trading session to close at $178.65. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 14.6% gain over the past four weeks.
Many homebuilding companies, like Meritage Homes, saw their stock prices surge after the Fed decided to keep the interest rate benchmark between 5.25% and 5.5%. Furthermore, the Federal Open Market Committee anticipates at least three rate cuts in 2024.
This homebuilder is expected to post quarterly earnings of $5.24 per share in its upcoming report, which represents a year-over-year change of -26.1%. Revenues are expected to be $1.54 billion, down 22.6% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Meritage, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on MTH going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Meritage is a member of the Zacks Building Products - Home Builders industry. One other stock in the same industry, M/I Homes (MHO), finished the last trading session 7.7% higher at $123.67. MHO has returned 12.7% over the past month.
For M/I Homes , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $4.94. This represents a change of -4.1% from what the company reported a year ago. M/I Homes currently has a Zacks Rank of #3 (Hold).
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Meritage Homes Corporation (MTH) : Free Stock Analysis Report
M/I Homes, Inc. (MHO) : Free Stock Analysis Report
