Critical Analysis: Everus (NYSE:ECG) & Meritage Homes (NYSE:MTH)

Meritage Homes (NYSE:MTH) and Everus (NYSE:ECG) are both mid-cap construction companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, valuation, risk, dividends, institutional ownership, analyst recommendations and earnings.

Insider & Institutional Ownership

98.4% of Meritage Homes shares are owned by institutional investors. 2.0% of Meritage Homes shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and price targets for Meritage Homes and Everus, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Meritage Homes	0	5	4	0	2.44
Everus	0	2	2	0	2.50

Meritage Homes presently has a consensus target price of $107.57, suggesting a potential upside of 42.06%. Everus has a consensus target price of $67.67, suggesting a potential downside of 1.88%. Given Meritage Homes’ higher possible upside, equities analysts clearly believe Meritage Homes is more favorable than Everus.

Earnings and Valuation

This table compares Meritage Homes and Everus”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Meritage Homes	$6.43 billion	0.85	$738.75 million	$11.04	6.86
Everus	$2.73 billion	1.29	$137.23 million	N/A	N/A

Meritage Homes has higher revenue and earnings than Everus.

Profitability

This table compares Meritage Homes and Everus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Meritage Homes	12.63%	16.89%	12.09%
Everus	N/A	N/A	N/A

Summary

Meritage Homes beats Everus on 9 of the 11 factors compared between the two stocks.

About Meritage Homes

Meritage Homes Corporation, together with its subsidiaries, designs and builds single-family attached and detached homes in the United States. The company operates through two segments, Homebuilding and Financial Services. It acquires and develops land; and constructs, markets, and sells homes for entry-level and first move-up buyers in Arizona, California, Colorado, Utah, Texas, Florida, Georgia, North Carolina, South Carolina, and Tennessee. The company also offers title and escrow, mortgage, insurance, and closing/settlement services to its homebuyers. Meritage Homes Corporation was founded in 1985 and is based in Scottsdale, Arizona.

About Everus

Everus Construction Group is providing a full spectrum of construction services through its electrical and mechanical and transmission and distribution specialty contracting services principally in United States. Its specialty contracting services are provided to utility, transportation, commercial, industrial, institutional, renewable and other customers. Everus Construction Group is based in BISMARCK, N.D.