Meritage Homes Continues To Get Hammered

In case you have not heard, the homebuilders are getting killed. The SPDR Homebuilders (XHB) exchange-traded fund (ETF) is down 32% since April 2006. And individual homebuilding stocks are getting clobbered even worse. For example, Meritage Homes (MTH), which operates in the southern and western United States, is down almost 60% from its August 2005 peak of $95.75.

Obviously MTH is on the price downside but it does have support in the high to mid $30 range. However, avoid this stock as well as the entire group of homebuilding stocks. More price declines are on the way.

September 7, 2006.