The historical rank and industry rank for Meritage Homes's Gross Margin % or its related term are showing as below:
MTH'
s Gross Margin % Range Over the Past 10 Years
Min: 18.08 Med: 20.5 Max: 28.63
Current: 25.45
During the past 13 years, the highestGross Margin % of Meritage Homes was 28.63%. The lowest was 18.08%. And the median was 20.50%.
MTH's Gross Margin % is ranked better than 70% of 100
companies
in the Homebuilding & Construction industry
Industry Median: 21.705
vs MTH: 25.45
Meritage Homes had a gross margin of 25.65% for the quarter that ended in Mar. 2024 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for Meritage Homes was 8.80% per year.
Meritage Homes Gross Margin % Historical Data
The historical data trend for Meritage Homes's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Competitive Comparison of Meritage Homes's Gross Margin %
For the Residential Construction subindustry, Meritage Homes's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Meritage Homes's Gross Margin % Distribution in the Homebuilding & Construction Industry
For the Homebuilding & Construction industry and Consumer Cyclical sector, Meritage Homes's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Meritage Homes's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
Meritage Homes (NYSE:MTH) Gross Margin % Explanation
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
Meritage Homes had a gross margin of 25.65% for the quarter that ended in Mar. 2024 => Competition eroding margins
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
Meritage Homes Gross Margin % Related Terms
Thank you for viewing the detailed overview of Meritage Homes's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Meritage Homes (Meritage Homes) Business Description
Meritage Homes Corp is engaged as a designer and builder of single-family attached and detached homes. It has operations in three regions: West, Central, and East, which are comprised of ten states: Arizona, California, Colorado, Texas, Florida, Georgia, North Carolina, South Carolina, Tennessee, and Utah. The company operates with two principal business segments; homebuilding and financial services. The homebuilding segments are engaged in the business of acquiring and developing land, constructing homes, marketing and selling those homes and providing warranty and customer services and the financial services segment offer title and escrow, mortgage, and insurance services. The company generates key revenue from the homebuilding segment.
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