MTH earnings analysis
What we found in MTH's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Meritage reported weaker Q1 results driven by lower closings, price concessions and margin pressure. Home closing revenue was $1,107,822,000 (down 17.5% YoY) and home closing gross margin compressed to 17.5% (down 450 bps), producing net earnings of $55.3 million for the quarter. Management emphasizes liquidity (cash $766.6 million and $829.0 million available on the Credit Facility) and execution priorities (record 345 active communities, ~2,600 lots purchased for $141.0 million), but the near-term demand environment remains challenged.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Strong liquidity position
- Company ended the quarter with $766.6 million of cash and cash equivalents and $829.0 million available under the Credit Facility (~$1.6 billion total capacity).
- Record active communities
- Active communities reached a company high of 345 (vs 290 at March 31, 2025), supporting future volume optionality.
- Construction cycle time improvement
- Construction cycle times remained under 110 calendar days (improved from historically ~120+ days), which management cites as a production efficiency driver.
- Share repurchases continuing
- The company repurchased 1,815,820 shares during the quarter and has $384.1 million remaining under its repurchase program.
- Active land investment
- The company purchased approximately 2,600 lots for $141.0 million and spent $185.1 million on land development (net of reimbursements) in the quarter.
- G&A cost reductions
- General and administrative expenses decreased to $51.4 million, down $5.6 million from the prior year quarter.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Material revenue decline
- Home closing revenue fell to $1,107,822,000, a 17.5% decrease from $1,342,104,000 in Q1 2025.
- Gross margin compression
- Home closing gross margin declined to 17.5% from 22.0% in the prior year quarter, a 450 basis point reduction (adjusted margin 17.8% vs 22.1%).
- Earnings sharply lower
- Net earnings were $55.3 million in the quarter versus $122.8 million in Q1 2025 (pre-tax earnings $72.5 million vs $160.2 million).
- Order/backlog deterioration
- Home orders decreased to 3,664 (down 5.5% YoY) and backlog value declined to $711,466,000 (down 12.4% YoY); homes in backlog were 1,865 (down 6.9%).
- Rising cancellations and ASP pressure
- Company cancellation rate rose to 11% (from 9% prior year) and average sales price on closings decreased to $373.4k (down $19.5k, or 5.0%).
- Land closing losses and impairments
- Land closing gross loss of $269,000 in Q1 2026 versus land closing gross profit of $3,165,000 in Q1 2025; real estate-related impairments and terminated land deal charges also impacted margins.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $0.86
- Gross margin
- 17.5%
- Segment
- West: $336,183,000 home closing revenue (down 29.9% YoY; homes closed 686, down 31.3%)
- Segment
- Central: $376,300,000 home closing revenue (down 8.8% YoY; homes closed 1,108, down 6.7%)
- Segment
- East: $395,339,000 home closing revenue (down 12.1% YoY; homes closed 1,173, down 4.7%)
What they said about what is next.
The 10-Q contains qualitative forward-looking language on liquidity and capital needs but does not provide explicit numeric FY2026 revenue or EPS guidance. (Separately, management updated full‑year 2026 home closing volume and revenue guidance to 'at or within 5% of full year 2025 results' in an 8‑K dated April 22, 2026.)
The filing reads worse than the one before it.
What came before.
- 10-K · February 13, 2026
- Meritage positions itself as a value-oriented, scale homebuilder focused on affordable, move-in ready entry-level and first move-up homes (100% spec strategy) and introduced a 60-day closing ready guarantee beginning in…
- 10-Q · October 31, 2025
- Meritage reported third-quarter closing revenue of $1,415,403,000 and diluted EPS of $1.39, both meaningfully lower than the year-ago quarter. Gross margin compressed to ~18.9% and earnings before taxes fell to…
- 10-Q · July 25, 2025
- Meritage reported Q2 total closing revenue of $1,623,986,000 and diluted EPS of $2.04. Revenue and gross profit declined versus prior-year quarter (revenue down $69.8M; gross profit down $98.9M) while cash and liquidity…
- 10-Q · April 25, 2025
- Meritage reported Q1 net earnings of $122,806 (diluted EPS $1.69) on total closing revenue of $1,357,525. Gross profit narrowed to $298,815 and earnings before income taxes fell to $160,159 versus the year-ago quarter.…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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