Meritage Homes (MTH) Q4 2024 earnings summary

Executive summary

• Achieved record annual home closings of 15,611 units and $6.34 billion in revenue for 2024, despite a lower average sales price and a focus on entry-level, move-in ready homes, which comprised 91% of Q4 orders and closings.

• Maintained a historically high home closing gross margin of 24.9% for the year and delivered diluted EPS of $21.44, with Q4 EPS at $4.72, down 12–13% year-over-year.

• Net sales orders increased 14% year-over-year in Q4 2024, with backlog conversion reaching a record 177%.

• Expanded operations through the acquisition of Elliott Homes, adding 5,500 lots in Mississippi, Alabama, and the Florida panhandle.

• Returned nearly $500 million to shareholders over three years via buybacks and dividends.

Financial highlights

• Q4 2024 home deliveries: 4,044 units; home closing revenue: $1.6 billion, down 3% year-over-year due to a 5% lower ASP, offset by a 2% increase in volume.

• Q4 home closing gross margin: 23.2%, down 200 bps year-over-year; SG&A leverage: 10.8%.

• Full year 2024 net earnings: $786 million; EBITDA exceeded $1 billion for the third consecutive year.

• Book value per share grew 12.9% year-over-year to $142.98.

• Debt-to-capital ratio was 20.6%; net debt-to-capital ratio was 11.7% at year-end.

Outlook and guidance

• 2025 guidance: 16,250–16,750 home closings and $6.6–$6.9 billion in home closing revenue.

• Q1 2025 guidance: 3,200–3,500 closings, $1.26–$1.40 billion revenue, gross margin around 22%, EPS $1.59–$1.83.

• Targeting 20,000 annual units by 2027, with double-digit community count growth expected in 2025.