Meritage Story

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MTH -- USA Stock  

USD 82.15  4.48  5.17%

Considering the 90-days investment horizon Meritage Homes is expected to generate 2.2 times less return on investment than the market. In addition to that, the company is 3.68 times more volatile than its market benchmark. It trades about 0.04 of its total potential returns per unit of risk. The DOW is currently generating roughly 0.31 per unit of volatility. While some risk-seeking stockholders are getting worried about consumer cyclical space, it is reasonable to concentrate on Meritage Homes as a possible investment alternative. We will examine how risky is to take a position in Meritage Homes at this time. Meritage Homes' seemingly stabilizing volatility may still impact the value of the stock as we estimate Meritage Homes as currently undervalued. The real value, based on our calculations, is getting close to 101.81 per share.
Published over three weeks ago
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Breaking down Meritage (NYSE:MTH) volatility
Meritage Homes has roughly 609.98 M in cash with 552.54 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 16.22.
Volatility is a rate at which the price of Meritage Corp or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Meritage Corp may increase or decrease. In other words, similar to Meritage's beta indicator, it measures the risk of Meritage Corp and helps estimate the fluctuations that may happen in a short period of time. So if prices of Meritage Corp fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.

How important is Meritage Corp's Liquidity

Meritage Corp financial leverage refers to using borrowed capital as a funding source to finance Meritage Corp ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Meritage Corp financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Meritage Corp's total debt and its cash.

How Meritage utilizes its cash?

To perform a cash flow analysis of Meritage Corp, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Meritage Corp is receiving and how much cash it distributes out in a given period. The Meritage Corp cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Meritage Corp Net Cash Flow from Operations is most likely to increase significantly in the upcoming years. The last year's value of Net Cash Flow from Operations was reported at 530.36 Million

Meritage Corp Volatility Drivers

Meritage Corp unsystematic risk is unique to Meritage Corp and usually not directly affected by the market or economic environment. An example of unsystematic risk is the possibility of poor earnings or a layoff due to coronavirus. One may mitigate nonsystematic risk by buying different securities in the same industry or by buying in different sectors. For example, if you have a position in Meritage Corp you can also buy Beazer Homes USA. You can also mitigate this risk by investing in the residential construction sector as well as in companies having nothing to do with it. This type of risk is also called diversifiable risk and can be understood from analyzing Meritage Corp important indicators over time. Here we run a correlation analysis between relevant fundamental ratios over at least ten year period to find a relationship in the way they react to changes in Meritage Corp income statement and balance sheet. Here are more details about Meritage volatility.
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