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Meritage Homes Corporation (MTH) vs Champion Homes, Inc. (SKY)

Meritage Homes Corporation and Champion Homes, Inc. are both Residential Construction companies. Meritage Homes Corporation and Champion Homes, Inc. are of similar size ($4.4B and $4.2B). Meritage Homes Corporation trades at the lower P/E: 13.4× against 24.8×. Champion Homes, Inc. grew revenue faster over the last twelve months: 4.52% against −13.3%. Champion Homes, Inc. has the higher net margin (7.16% vs 6.11%) and the higher return on invested capital (18.2% vs 3.99%). Across the 22 metrics below, Champion Homes, Inc. leads on 14 and Meritage Homes Corporation on 8.

Valuation

Metric MTH SKY Residential Construction median
P/E 13.40 24.75 13.85
P/S 0.79 1.74 1.24
P/B 0.84 2.96 1.25
Price to free cash flow 10.21 17.14 17.14
EV/EBITDA 12.78 13.78 11.19
EV/Sales 0.98 1.46 1.33
Earnings yield 7.46% 4.04% 7.02%
Free cash flow yield 9.79% 5.83% 5.75%

Profitability

Metric MTH SKY Residential Construction median
Gross margin 18.12% 25.96% 22.60%
Operating margin 7.22% 8.74% 9.03%
Net margin 6.11% 7.16% 7.30%
Free cash flow margin 7.70% 10.17% 8.46%
Return on equity 6.38% 12.18% 11.12%
Return on assets 4.30% 8.91% 7.43%
Return on invested capital 3.99% 18.19% 6.90%

Growth

Metric MTH SKY Residential Construction median
Revenue growth (TTM) (13.27%) 4.52% (7.28%)
EPS growth (last fiscal year) (40.77%) 7.02% (25.22%)
Revenue growth, 5-year CAGR 5.41% 13.39% 8.74%
Net income growth, 5-year CAGR 1.36% 19.52% 8.60%

Health

Metric MTH SKY Residential Construction median
Debt to equity 0.37 0.01 0.20
Current ratio 1.97 2.74 3.53
Net debt to EBITDA 1.86 (2.08) 0.28

Dividend

Metric MTH SKY Residential Construction median
Dividend yield 2.90% — 1.23%
Payout ratio 0.39 — 0.17

Size

Metric MTH SKY Residential Construction median
Market cap 4.20b 4.40b 4.20b

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