Financial Comparison: Meritage Homes (NYSE:MTH) versus Breville Group (OTCMKTS:BVILF)

Meritage Homes (NYSE:MTH) and Breville Group (OTCMKTS:BVILF) are both consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, risk, dividends, profitability, institutional ownership and valuation.

Insider & Institutional Ownership

98.4% of Meritage Homes shares are held by institutional investors. Comparatively, 24.9% of Breville Group shares are held by institutional investors. 2.5% of Meritage Homes shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Meritage Homes and Breville Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Meritage Homes	6.11%	7.13%	4.83%
Breville Group	N/A	N/A	N/A

Dividends

Meritage Homes pays an annual dividend of $1.92 per share and has a dividend yield of 2.7%. Breville Group pays an annual dividend of C$0.26 per share and has a dividend yield of 1.1%. Meritage Homes pays out 40.2% of its earnings in the form of a dividend. Breville Group pays out 69.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Meritage Homes has increased its dividend for 2 consecutive years. Meritage Homes is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a summary of recent ratings and target prices for Meritage Homes and Breville Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Meritage Homes	0	7	5	0	2.42
Breville Group	0	0	0	0	0.00

Meritage Homes currently has a consensus target price of $79.25, indicating a potential upside of 10.15%. Given Meritage Homes’ stronger consensus rating and higher possible upside, research analysts clearly believe Meritage Homes is more favorable than Breville Group.

Valuation and Earnings

This table compares Meritage Homes and Breville Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Meritage Homes	$5.86 billion	0.80	$453.01 million	$4.78	15.05
Breville Group	N/A	N/A	N/A	C$0.37	65.90

Meritage Homes has higher revenue and earnings than Breville Group. Meritage Homes is trading at a lower price-to-earnings ratio than Breville Group, indicating that it is currently the more affordable of the two stocks.

Summary

Meritage Homes beats Breville Group on 13 of the 14 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 Breville Group

Breville Group Limited designs, develops, markets, and distributes small electrical kitchen appliances in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company was formerly known as Housewares International Limited and changed its name to Breville Group Limited in November 2008. Breville Group Limited was founded in 1957 and is headquartered in Alexandria, Australia.