Meritage HomesFRA:MEY +0.70%79 ROA % is 2.93% as of Mar. 2026, which is 69% below its 10-year median of 9.51. GuruFocus rates FRA:MEY with a GF Score™ of 79/100 and a GF Value™ of €58.31 (Modestly Overvalued). The stock has 11 warning signs investors should review. Among 96 Homebuilding & Construction companies, Meritage Homes ranks better than 69.79% on this metric.
ROA % is calculated as Net Income divided by its average Total Assets over a certain period of time. Meritage Homes's annualizedNet Income for the quarter that ended in Mar. 2026 was €191 Mil.
Meritage Homes's average Total Assets over the quarter that ended in Mar. 2026 was €6,522 Mil. Therefore, Meritage Homes's annualized ROA % for the quarter that ended in Mar. 2026 was 2.93%.
The historical rank and industry rank for Meritage Homes's ROA % or its related term are showing as below:
FRA:MEY'
s ROA % Range Over the Past 10 Years
Min: 4.67 Med: 9.51 Max: 18.76
Current: 5.02
During the past 13 years, Meritage Homes's highest ROA % was 18.76%. The lowest was 4.67%. And the median was 9.51%.
FRA:MEY's ROA % is ranked better than 69.79% of 96
companies
in the Homebuilding & Construction industry
Industry Median: 3.1
vs FRA:MEY: 5.02
Meritage Homes (FRA:MEY) ROA % Explanation
ROA % measures the rate of return on the total assets (shareholder equity plus liabilities). It measures a firm's efficiency at generating profits from shareholders' equity plus its liabilities. ROA % shows how well a company uses what it has to generate earnings. ROA %s can vary drastically across industries. Therefore, ROA % should not be used to compare companies in different industries. For retailers, a ROA % of higher than 5% is expected. For example, Wal-Mart (WMT) has a ROA % of about 8% as of 2012. For banks, ROA % is close to their interest spread. A banks ROA % is typically well under 2%.
Similar to ROE, ROA % is affected by profit margins and asset turnover. This can be seen from the Du Pont Formula:
Note:
The Net Income data used here is four times the quarterly (Mar. 2026) net income data. The Revenue data used here is four times the quarterly (Mar. 2026) revenue data.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Be Aware
Like ROE, ROA % is calculated with only 12 months data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective. ROA % can be affected by events such as stock buyback or issuance, and by goodwill, a company's tax rate and its interest payment. ROA % may not reflect the true earning power of the assets. A more accurate measurement is ROC % (ROC).
Many analysts argue the higher return the better. Buffett states that really high ROA % may indicate vulnerability in the durability of the competitive advantage.
E.g. Raising $43b to take on KO is impossible, but $1.7b to take on Moody's is. Although Moody's ROA % and underlying economics is far superior to Coca Cola, the durability is far weaker because of lower entry cost.
Meritage Homes ROA % Related Terms
Meritage Homes ROA % Historical Data
* Premium members only.
The historical data trend for Meritage Homes's ROA % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Residential Construction subindustry, Meritage Homes's ROA %, along with its competitors' market caps and ROA % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Meritage Homes ROA % vs Homebuilding & Construction Industry
For the Homebuilding & Construction industry and Consumer Cyclical sector, Meritage Homes's ROA % distribution charts can be found below:
* The bar in red indicates where Meritage Homes's ROA % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
In the calculation of annual ROA %, the net income of the last fiscal year and the average total assets over the fiscal year are used. In calculating the quarterly data,
the Net Income data used here is four times the quarterly (Mar. 2026) net income data.
ROA % is displayed in the 30-year financial page.
Meritage Homes (FRA:MEY) has a ROA % of 2.93% as of Mar. 2026. Return on assets is the ratio of current-period net income to average two-period total assets. View historical data on Meritage Homes and its competitors. This is 69% below median its historical median of 9.51. Over the past decade, Meritage Homes' ROA % has ranged from 4.67 to 18.76. According to the industry distribution chart, Meritage Homes ranks #29 out of 96 companies in the Homebuilding & Construction industry, placing it in the top 30.2%.
Is Meritage Homes' ROA % too high?
Meritage Homes' current ROA % of 2.93% is 69% below median its 10-year median of 9.51. Over the past 10 years, this metric has ranged from a low of 4.67 to a high of 18.76. The Homebuilding & Construction industry median ROA % is 3.10. Meritage Homes' value of 2.93% is 5.5% below this industry median. Based on the distribution chart, Meritage Homes ranks #29 out of 96 companies in the Homebuilding & Construction industry, which is above the industry midpoint. Overall, Meritage Homes has a GF Score™ of 79/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Meritage Homes' ROA % compare to CVCO and SKY?
According to the Homebuilding & Construction industry distribution chart, Meritage Homes ranks #29 out of 96 companies for ROA %. This puts Meritage Homes in the upper half of its industry. The industry median ROA % is 3.10. Meritage Homes' value of 2.93% is 5.5% below this benchmark. Historically, Meritage Homes' own ROA % has ranged from 4.67 to 18.76 over the past decade. While the company's 10-year median is 9.51 vs. the industry median of 3.10, Meritage Homes has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROA % for a Homebuilding & Construction company?
The median ROA % among Homebuilding & Construction companies is 3.10, based on 96 companies in the industry. Companies in the top quartile (top 25%) have a ROA % significantly above this median, while those in the bottom quartile fall well below. However, ROA % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Meritage Homes's current ROA % of 2.93% is 5.5% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROA % mean?
A high ROA % can signal that a stock is expensive relative to its fundamentals. Return on assets is the ratio of current-period net income to average two-period total assets. View historical data on Meritage Homes and its competitors. For the Homebuilding & Construction industry, the median ROA % is 3.10 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Meritage Homes's current ROA % is 2.93%, which is 69% below median its own 10-year median of 9.51. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Meritage Homes stock overvalued right now?
Based on GuruFocus' analysis, Meritage Homes (FRA:MEY) is currently considered Modestly Overvalued. The stock's GF Value™ is €58.31, compared to a current price of €72.00 — trading 23.5% above its estimated fair value. The current ROA % is 2.93%, which is 69% below median its 10-year median of 9.51 and 5.5% below the Homebuilding & Construction industry median of 3.10. Meritage Homes' overall GF Score™ is 79/100 with 11 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROA % calculated?
ROA % is calculated from a company's financial statements. For Meritage Homes (FRA:MEY), the current ROA % is 2.93% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Meritage Homes (FRA:MEY) Overvalued in 2026?
Based on GuruFocus' analysis, Meritage Homes stock appears to be overvalued.
The current stock price of €72.00 is trading 23.5% above its estimated GF Value™ of €58.31.
GuruFocus considers Meritage Homes to be Modestly Overvalued.
Key valuation signals for FRA:MEY:
ROA %: 2.93% (69% below median its 10-year median of 9.51)
GF Value™: €58.31 vs. price of €72.00 (23.5% above fair value)
Industry Position: 5.5% below the Homebuilding & Construction median (#29 of 96)
No single metric tells the full story. See the FRA:MEY stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Meritage Homes Corp is engaged as a designer and builder of single-family attached and detached homes. It has operations in three regions: West, Central, and East, comprising twelve states: Arizona, California, Colorado, Utah, Tennessee, Texas, Alabama, Florida, Georgia, Mississippi, North Carolina, and South Carolina. The company operates with two principal business segments: homebuilding and financial services. The homebuilding segments are engaged in the business of acquiring and developing land, constructing homes, marketing and selling those homes, and providing warranty and customer services, and the financial services segment offers title and escrow, mortgage, and insurance services. The company generates key revenue from the Homebuilding segment.
79GF Score
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