MTH vs DHI

For growth investors, D.

R. Horton, Inc. (DHI) is the stronger pick with -6. 9% revenue growth year-over-year, versus -8. 4% for Meritage Homes Corporation (MTH). Meritage Homes Corporation (MTH) offers the better valuation at 10. 1x trailing P/E (12. 9x forward), making it the more compelling value choice. Analysts rate Meritage Homes Corporation (MTH) a "Buy" — based on 38 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, Meritage Homes Corporation (MTH) is the cheapest at 10.

1x versus D. R. Horton, Inc. at 12. 9x. On forward P/E, Meritage Homes Corporation is actually cheaper at 12. 9x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: D. R. Horton, Inc. wins at 1. 12x versus Meritage Homes Corporation's 4. 19x — a reasonable growth-adjusted valuation.

Over the past 5 years, D.

R. Horton, Inc. (DHI) delivered a total return of +52. 9%, compared to +23. 2% for Meritage Homes Corporation (MTH). Over 10 years, the gap is even starker: DHI returned +434. 6% versus MTH's +319. 4%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), D.

R. Horton, Inc. (DHI) is the lower-risk stock at 0. 85β versus Meritage Homes Corporation's 1. 17β — meaning MTH is approximately 39% more volatile than DHI relative to the S&P 500. On balance sheet safety, D. R. Horton, Inc. (DHI) carries a lower debt/equity ratio of 24% versus 36% for Meritage Homes Corporation — giving it more financial flexibility in a downturn.

By revenue growth (latest reported year), D.

R. Horton, Inc. (DHI) is pulling ahead at -6. 9% versus -8. 4% for Meritage Homes Corporation (MTH). On earnings-per-share growth, the picture is similar: D. R. Horton, Inc. grew EPS -19. 3% year-over-year, compared to -40. 3% for Meritage Homes Corporation. Over a 3-year CAGR, DHI leads at 0. 8% annualised revenue growth. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.

D.

R. Horton, Inc. (DHI) is the more profitable company, earning 10. 5% net margin versus 7. 7% for Meritage Homes Corporation — meaning it keeps 10. 5% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: DHI leads at 12. 9% versus 9. 2% for MTH. At the gross margin level — before operating expenses — DHI leads at 23. 7%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential.

By this metric, D. R. Horton, Inc. (DHI) is the more undervalued stock at a PEG of 1. 12x versus Meritage Homes Corporation's 4. 19x. A PEG below 1. 5 suggests fair-to-attractive pricing relative to expected growth. On forward earnings alone, Meritage Homes Corporation (MTH) trades at 12. 9x forward P/E versus 14. 0x for D. R. Horton, Inc. — 1. 1x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for MTH: 28. 4% to $83. 25.

All stocks in this comparison pay dividends.

Meritage Homes Corporation (MTH) offers the highest yield at 2. 6%, versus 1. 1% for D. R. Horton, Inc. (DHI).

For long-horizon retirement investors, D.

R. Horton, Inc. (DHI) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0. 85), 1. 1% yield, +434. 6% 10Y return). Both have compounded well over 10 years (DHI: +434. 6%, MTH: +319. 4%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Consumer Cyclical sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both.

These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.