KB Home (KBH) vs Meritage Homes Corporation (MTH)

KB Home and Meritage Homes Corporation are both Residential Construction companies. Meritage Homes Corporation is the larger, with a market value of $4.2B against $2.9B — 1.4× the size. KB Home trades at the lower P/E: 13.3× against 13.5×. Meritage Homes Corporation grew revenue faster over the last twelve months: −13.3% against −20.8%. Meritage Homes Corporation has the higher net margin (6.11% vs 4.38%) and the lower return on invested capital (3.99% vs 4.60%). Both pay a dividend; KB Home yields more (1.32% vs 0.74%). Across the 23 metrics below, KB Home leads on 15 and Meritage Homes Corporation on 8.

Valuation

Metric KBH MTH Residential Construction median
P/E 13.25 13.51 13.51
P/S 0.56 0.79 1.02
P/B 0.77 0.85 1.17
Price to free cash flow 8.12 10.30 16.79
EV/EBITDA 11.81 12.86 10.48
EV/Sales 0.86 0.99 1.31
Earnings yield 7.55% 7.40% 7.37%
Free cash flow yield 12.31% 9.71% 5.73%

Profitability

Metric KBH MTH Residential Construction median
Gross margin 13.69% 18.12% 22.30%
Operating margin 5.18% 7.22% 9.03%
Net margin 4.38% 6.11% 7.30%
Free cash flow margin 0.00% 7.70% 8.46%
Return on equity 0.00% 6.38% 9.84%
Return on assets 3.25% 4.30% 7.43%
Return on invested capital 4.60% 3.99% 6.90%

Growth

Metric KBH MTH Residential Construction median
Revenue growth (TTM) (20.80%) (13.27%) (7.37%)
EPS growth (last fiscal year) (27.22%) (40.77%) —
Revenue growth, 5-year CAGR 8.31% 5.41% 8.74%
Net income growth, 5-year CAGR 7.65% 1.36% 8.43%

Health

Metric KBH MTH Residential Construction median
Debt to equity 0.00 0.37 0.20
Current ratio 2.07 1.97 3.56
Net debt to EBITDA 2.56 1.86 0.28

Dividend

Metric KBH MTH Residential Construction median
Dividend yield 1.32% 0.74% 0.89%
Payout ratio 0.09 0.02 0.00

Size

Metric KBH MTH Residential Construction median
Market cap 2.90b 4.20b 4.18b

Compare with another peer

Any metric, up to five companies and an Excel export Powerpack