MODEL VERDICT
Meritage Homes Corporation (MTH)
Relative Valuation•Peer multiples, Monte Carlo simulation & quality-adjusted fair value
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Composite score derived from valuation, quality, and risk factors
Quantitative model thresholds · For educational and research purposes only
Each row records the model's monthly assessment. High Conviction = the model detected notable undervaluation vs peers. Neutral = no notable divergence was found. The return column shows the actual price change over 90 days for reference. This is a quantitative observation log — not investment advice.
| Date | Assessment | Score | Price | Status | 90d Fwd Return |
|---|---|---|---|---|---|
| May 1, 2026 | NEUTRAL | 0.22 | $66.34 | CURRENT | — |
| Apr 24, 2026 | NEUTRAL | 0.21 | $69.07 | CURRENT | — |
| Apr 17, 2026 | NEUTRAL | 0.21 | $68.07 | CURRENT | — |
| Apr 16, 2026 | NEUTRAL | 0.21 | $65.03 | CURRENT | — |
| Apr 10, 2026 | NEUTRAL | 0.22 | $66.55 | CURRENT | — |
Historical model observations for research purposes only. Past quantitative patterns do not predict future results. Not a recommendation to buy, sell, or hold any security.
| Methodology | Fair Value | vs Current | Weight | Quality | Status |
|---|---|---|---|---|---|
| Forward P/E 11 analyst estimates | $72.11 | +8.7% | 20% | A- | Analyst Est. |
| EV/EBITDA 11 industry peers | $43.46 | -34.5% | 20% | A- | Peer Data |
| Industry Median P/E 11 industry peers | $70.94 | +6.9% | 15% | A | Peer Data |
| Price / Free Cash Flow 10 industry peers | $18.85 | -71.6% | 15% | B+ | Peer Data |
| EV/EBIT 11 industry peers | $56.11 | -15.4% | 8% | B+ | Peer Data |
| EV/FCF 10 industry peers | $5.00 | -92.5% | 7% | B | Model Driven |
| Peg Ratio 10 industry peers | $15.12 | -77.2% | 5% | B | Data |
| EV To Revenue 11 industry peers | $96.49 | +45.4% | 4% | B | Data |
| Price / Sales 11 industry peers | $101.59 | +53.1% | 3% | B | Model Driven |
| Earnings Yield 11 industry peers | $70.94 | +6.9% | 2% | B | Data |
| FCF Yield 11 industry peers | $20.41 | -69.2% | 1% | B | Data |
| Weighted Output Blended model output | $53.14 | -19.9% | 100% | 82 | OVERVALUED |
| EPS Growth ↓ | P/E Multiple → | 6× | 8× | 10× (Current) | 12× | 14× |
|---|---|---|---|---|---|
| Bear Case (2%) | $39 | $52 | $65 | $78 | $91 |
| Conservative (5%) | $40 | $54 | $67 | $81 | $94 |
| Base Case (3.1%) | $40 | $53 | $66 | $79 | $92 |
| Bull Case (4%) | $40 | $53 | $67 | $80 | $93 |
Cross-sectional regression predicting expected multiples based on growth, margins, ROIC, and beta.
| Multiple | Avg | Median | Min | Max | Std |
|---|---|---|---|---|---|
| P/E Ratio | 7.57 | 7.53 | 3.45 | 10.28 | 2.28 |
| EV/EBIT | 7.05 | 6.66 | 2.90 | 10.74 | 2.68 |
| EV/EBITDA | 6.74 | 6.48 | 2.85 | 10.26 | 2.46 |
| P/FCF | 18.67 | 9.04 | 6.24 | 50.34 | 18.58 |
| P/FFO | 7.17 | 7.01 | 3.36 | 9.74 | 2.08 |
| P/TBV | 1.20 | 1.20 | 0.87 | 1.55 | 0.26 |
| P/AFFO | 7.56 | 7.33 | 3.46 | 10.30 | 2.28 |
| P/B Ratio | 1.19 | 1.20 | 0.87 | 1.53 | 0.25 |
| Div Yield | 0.02 | 0.02 | 0.01 | 0.03 | 0.01 |
| P/S Ratio | 0.79 | 0.80 | 0.54 | 1.05 | 0.17 |
Based on our peer multiples analysis with 27 valuation metrics, the model estimates MTH's fair value at $53.14 vs the current price of $66.34, implying -19.9% downside potential. Model verdict: Overvalued. Confidence: 82/100. This is a quantitative estimate, not a recommendation.
The blended fair value of $53.14 is calculated using four lenses: industry median multiples (40%), historical multiples (30%), forward estimates (20%), and quality-adjusted multiples (10%). Monte Carlo simulation (10,000 iterations) gives a range of $43.74 (P10) to $55.09 (P90), with a median of $49.42.
MTH's current P/E of 10.4x compares to the industry median of 11.1x (11 peers in the group). This represents a -6.5% discount to the industry. The historical average P/E is 7.6x over 7 years. Signal: Fair Value.
38 analysts cover MTH with a consensus rating of Buy. The consensus price target is $83.25 (range: $77.00 — $90.00), implying +25.5% upside from the current price. Grade breakdown: Strong Buy (0), Buy (19), Hold (16), Sell (3), Strong Sell (0).
The model confidence score is 82/100, based on: data completeness (30), peer quality (25), historical depth (20), earnings stability (8), and model agreement (7). Cyclicality penalty: --8 points. The model shows strong agreement across inputs.
The model flags several key risks: (1) Multiple compression: MTH trades at the 2630th percentile of its historical P/E range. A reversion to median (7.6×) would imply significant downside. (2) Macro/regulatory risks are not captured in this model but remain material.
Peak earnings risk refers to the possibility that MTH's current profitability is above its sustainable long-term trend. The model detects a margin Z-score of -1.4σ, meaning margins are 1.4 standard deviations below their historical average. If margins revert to the 7-year mean (14.2%), the model estimates fair value drops by 5060.0% to approximately $100. This isn't a prediction — it's a scenario analysis.
No. This dashboard is a quantitative research tool for educational and informational purposes only. It is not investment advice, a solicitation, or a recommendation to buy, sell, or hold any security. The operator of this platform is not a registered investment advisor (RIA), broker-dealer, or financial planner. All model outputs, fair value estimates, signals, and scenarios are the result of automated quantitative computations and should not be construed as professional financial guidance. You should consult a qualified, licensed financial advisor before making any investment decisions. Past model performance is not indicative of future results.