Meritage Corporation (MTH)
Return on total capital
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 949,430 | 1,289,360 | 955,152 | 535,743 | 311,315 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 4,611,900 | 3,949,610 | 3,044,390 | 2,347,870 | 1,973,990 |
| Return on total capital | 20.59% | 32.65% | 31.37% | 22.82% | 15.77% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $949,430K ÷ ($—K + $4,611,900K)
= 20.59%
Over the past five years, Meritage Homes Corp.'s return on total capital has displayed a fluctuating trend. In 2022, the company achieved the highest return on total capital at 25.23%, indicating efficient utilization of both debt and equity to generate profits. Although there was a slight decrease in 2023 to 16.06%, the company maintained a relatively strong performance, showing a robust ability to generate returns on the total capital employed. The consistent performance above 15% reflects Meritage Homes Corp.'s effective capital allocation strategies and operational efficiency, which have contributed to creating shareholder value over the years.
Peer comparison
Dec 31, 2023