UPDATE: Goldman Sachs Reiterates Neutral Rating, Raises PT on Meritage Homes
In a report published Monday, the Goldman Sachs Group reiterated its Neutral rating on Meritage Homes Corporation (NYSE: MTH), and raised its price target from $24.00 to $46.00.
Goldman Sachs noted, “We increase our 2012-2014 revenue and EPS estimates to reflect our new home sales and pricing expectations. Our higher new home sales expectations translate to higher backlog growth and faster backlog absorption leading to the sales acceleration. The inherent leverage from fixed G&A expenditure lends to faster net income growth. Our target price time frame is now 12 months (from 6 months) to reflect our long term view on the homebuilders. Our target price is based on normalized earnings and tax adjusted book value. We increase our target price to $46 from $24, as we raise our normalized EPS estimate to $5.17 from $2.75 and apply a 12X multiple (8.5X earlier). We apply a 1.4X multiple (unchanged) to tax adjusted book value.”
Meritage Homes Corporation closed on Friday at $35.08.
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|Oct 2014||Keefe Bruyette & Woods||Maintains||Market Perform|
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