Meritage Corporation (MTH)
Debt-to-capital ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| 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 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $—K ÷ ($—K + $4,611,900K)
= 0.00
The debt-to-capital ratio of Meritage Homes Corp. has been trending downwards over the past five years, indicating a decreasing reliance on debt financing relative to total capital employed. This suggests improved financial stability and a stronger capital structure, as a lower ratio reflects a lower proportion of debt in the company's capital mix.
The ratio decreased from 0.34 in 2019 to 0.18 in 2023, showcasing a significant improvement in the company's ability to generate capital through equity or retained earnings rather than relying on debt. This reduction in debt dependency may lead to lower interest expenses, decreased financial risk, and enhanced investor confidence.
Overall, the declining debt-to-capital ratio of Meritage Homes Corp. demonstrates a positive trend towards a healthier financial position and sustainable growth prospects.
Peer comparison
Dec 31, 2023