Forensic Analysis · Homebuilders & Residential Construction · as of Nov 8, 2026

Meritage Homes Corp (MTH)

A forensic read on Meritage Homes Corp built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.

C · Mixed — selective

Forensic grade

Forensic signals

8.8%

ROE

This free snapshot doesn't read filing or proxy text, so the auditor-quality and governance checks that can lower a grade were not evaluated (auditor quality, say on pay, board independence, going concern). Those checks only ever lower a grade, so the full analysis can land below the grade above but never above it — treat it as the most favourable reading, not the settled one.

Meritage Homes Corp earns a C (Mixed — selective) forensic quality grade. 3 forensic signals were flagged in its latest SEC filings, led by cash conversion.

What the filings flag

0.12×

FY2023–FY2025

Cash conversion. Over FY2023–FY2025, cumulative operating cash flow was 0.12× cumulative net income. Reported profit is not turning into cash. The shortfall is profit tied up in working capital rather than collected — the accrual and receivables lines below show where.Cash conversion: operating cash flow divided by net income, the share of profit that arrived as cash.

449% of FCF

FY2025

Shareholder returns. Returned $416M to shareholders (buybacks + dividends) in FY2025 — 449% of free cash flow. That is $324M (349%) more than free cash flow covered, and more than operating cash flow as well. New debt covered it: total debt rose $498M over FY2025, while cash rose $124M. A payout past free cash flow draws the balance sheet down in every year it continues, which isn't sustainable indefinitely.

7.5%

FY2025

Return on invested capital. Return on invested capital is 7.5% in the latest fiscal year and slipping across FY2023–FY2025 from 15.8%. After-tax operating profit was $739M in FY2023 and $453M in FY2025. The capital base behind it grew +28% across FY2023–FY2025, from $4.7B to $6.0B, while the return fell 8.3 points, so the dollars added over that window earned less than the 15.8% the older base was already earning.

Key fundamentals

Free Cash Flow$92.6M

Return on Equity8.8%

Debt / Equity0.35x

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Data from SEC EDGAR public filings · metrics as of Nov 8, 2026. Forensic signals flag probability, not certainty.

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