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1. Company Snapshot

1.a. Company Description

M/I Homes, Inc., together with its subsidiaries, operates as a builder of single-family homes in Ohio, Indiana, Illinois, Minnesota, Michigan, Florida, Texas, North Carolina, and Tennessee.The company operates through Northern Homebuilding, Southern Homebuilding, and Financial Services segments.It designs, constructs, markets, and sells single-family homes and attached townhomes to first-time, millennial, move-up, empty-nester, and luxury buyers under the M/I Homes brand name.


The company also purchases undeveloped land to develop into developed lots for the construction of single-family homes, as well as for sale to others.In addition, it originates and sells mortgages; and serves as a title insurance agent by providing title insurance policies, examination, and closing services to purchasers of its homes.The company was formerly known as M/I Schottenstein Homes, Inc.


and changed its name to M/I Homes, Inc.in January 2004.M/I Homes, Inc.


was founded in 1976 and is based in Columbus, Ohio.

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1.b. Last Insights on MHO

M/I Homes' recent performance was negatively impacted by declining revenue and net income, missing earnings expectations for the fourth consecutive quarter. High mortgage rates and affordability issues for entry-level buyers led to reduced contracts, backlog, and increased cancellations. Despite a strong balance sheet and undervaluation relative to peers, growth is constrained by demand shifts and uncertain market conditions. The company's Q3 2025 results showed a 1% increase in homes delivered, but revenue declined 1% to $1.1 billion, with pre-tax income down 26%. A $50 million share buyback and upgraded credit rating from Moody's were notable positives.

1.c. Company Highlights

2. M/I Homes' Solid Performance Amidst Macroeconomic Pressures

M/I Homes delivered a solid financial performance in 2025, with revenue reaching $4.4 billion and pretax income of $590 million, down 20% compared to the previous year's record $734 million. The company's net income was $403 million, or $14.74 per share, with a return on equity of 13.1%. The earnings per share (EPS) came in at $14.74, slightly above analyst estimates. The gross margin, excluding inventory and warranty charges, was 24.4%, 220 basis points lower than in 2024.

Publication Date: Feb -04

📋 Highlights
  • Revenue and Profitability:: Recorded $4.4 billion revenue in 2025, with pretax income of $590 million (13% margin before $59M charges), down 20% YoY but ROE at 13.1%.
  • Regional Growth:: Southern markets (Nashville, Fort Myers Naples) drove 13% sales growth, with 79% of Q4 sales from inventory homes, up from 67% in 2024.
  • Margin Pressures:: Full-year gross margins fell 220 bps to 24.4%, though Q4 closing margins stabilized at 22.6% despite macroeconomic challenges.
  • Spec Home Dominance:: 66-75% of sales now from spec homes, up from <50% five years ago, reflecting strategic shift to meet demand and manage inventory.
  • Balance Sheet Strength:: Ended Q4 with $689 million cash, no borrowings on credit facility, and $3.2 billion shareholders’ equity, up 8% YoY.

Segment Performance

The financial services segment achieved a record capture rate of 93% and pretax income of $56 million. The mortgage and title operations reported pretax income of $8.5 million in the fourth quarter, down $1.6 million from the previous year. The company's land purchase activity accelerated in the fourth quarter, with a significant increase in lot development spend.

Operational Highlights

The company reported an improvement in traffic, with most markets picking up, and a sales pace of 2.8 in the fourth quarter, compared to 2.7 in the previous year. The cancellation rate was 10%. The backlog gross margin was higher than in specs, with a 100 basis point difference. As Bob Schottenstein mentioned, "about two thirds to three fourths of our sales are now coming from specs."

Valuation Metrics

Using the current price, the Price-to-Earnings (P/E) ratio is 8.77, and the Price-to-Book (P/B) ratio is 1.12. The EV/EBITDA ratio is 7.17, indicating a relatively reasonable valuation. The Return on Equity (ROE) is 12.99%, and the Return on Invested Capital (ROIC) is 39.24%, suggesting efficient capital allocation.

Outlook

The company is confident in its strategy, with a focus on improving margins on specs and adjusting to market conditions. Analysts estimate revenue growth of 7.0% for the next year. With a strong balance sheet, including a cash balance of $689 million and no borrowings under its unsecured credit facility, M/I Homes is well-positioned to navigate the challenging environment. As Phil Creek noted, "we try to have about a one year supply of finished lots." The company's guidance suggests a continued focus on managing inventory levels and adapting to changing market conditions.

3. NewsRoom

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M/I Homes: An Undervalued “Corner-Lot” With A View

Feb -10

Source: forbes.com

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Barrick Mining Corp: A Significant Exit by Azvalor Managers FI with a -3.38% Impact

Feb -04

Source: gurufocus.com

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M/I Homes, Inc. (MHO) Q4 2025 Earnings Call Transcript

Jan -28

Source: seekingalpha.com

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M/I Homes (MHO) Q4 Earnings Beat Estimates

Jan -28

Source: zacks.com

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M/I Homes Reports Fourth Quarter and Year-End Results

Jan -28

Source: prnewswire.com

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M/I Homes (MHO) Stock Falls Amid Market Uptick: What Investors Need to Know

Jan -23

Source:

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ITB: An Affordability Push Boosts The Seasonal Trade In Homebuilders

Jan -13

Source: seekingalpha.com

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The Nation's Largest Homebuilder Commands a 75% Valuation Premium Despite Lower Returns Than Its Regional Rival

Jan -13

Source: 247wallst.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.63%)

6. Segments

Southern Homebuilding

Expected Growth: 4.5%

M/I Homes' Southern Homebuilding segment growth of 4.5% is driven by increasing demand for new homes in the region, fueled by a strong job market, low unemployment, and favorable demographics. Additionally, the segment benefits from the company's strategic expansion into high-growth markets, such as Texas and Florida, and its focus on affordable and move-up homes.

Northern Homebuilding

Expected Growth: 4.8%

Northern Homebuilding from M/I Homes, Inc. achieved 4.8% growth driven by increasing demand for new homes in the Midwest and Northeast regions, fueled by low unemployment rates, rising wages, and favorable demographics. Additionally, the segment benefited from strategic land acquisitions, improved operational efficiencies, and a strong brand reputation.

Financial Services

Expected Growth: 5.2%

M/I Homes, Inc.'s 5.2% growth in Financial Services is driven by increasing mortgage originations, expansion of title services, and growth in insurance business. Additionally, the company's strategic partnerships and investments in digital platforms have enhanced customer experience, leading to increased revenue and market share.

7. Detailed Products

Single-Family Homes

M/I Homes, Inc. builds and sells single-family homes in various communities across the United States. These homes range from starter homes to luxury estates, catering to a wide range of buyers.

Townhomes

M/I Homes, Inc. also builds and sells townhomes in select communities, offering a more affordable and low-maintenance alternative to single-family homes.

Condominiums

In addition to single-family homes and townhomes, M/I Homes, Inc. develops and sells condominiums in select markets, offering a convenient and amenity-rich living experience.

Land Development

M/I Homes, Inc. also engages in land development, acquiring and developing raw land for future homebuilding projects.

Financial Services

M/I Homes, Inc. offers financial services, including mortgage financing and title insurance, to support homebuyers throughout the homebuying process.

8. M/I Homes, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

M/I Homes, Inc. operates in a highly competitive industry, but the threat of substitutes is relatively low due to the unique nature of its products and services.

Bargaining Power Of Customers

M/I Homes, Inc. has a diverse customer base, which reduces the bargaining power of individual customers. However, the company still needs to be responsive to customer needs and preferences.

Bargaining Power Of Suppliers

M/I Homes, Inc. has a diverse supplier base, which reduces the bargaining power of individual suppliers. The company also has a strong negotiating position due to its large scale of operations.

Threat Of New Entrants

The homebuilding industry is highly competitive, and new entrants can easily enter the market. M/I Homes, Inc. needs to continuously innovate and improve its operations to stay ahead of the competition.

Intensity Of Rivalry

The homebuilding industry is highly competitive, and M/I Homes, Inc. faces intense rivalry from established players. The company needs to focus on differentiating itself through its products and services to gain a competitive edge.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 25.88%
Debt Cost 4.99%
Equity Weight 74.12%
Equity Cost 14.75%
WACC 12.22%
Leverage 34.92%

11. Quality Control: M/I Homes, Inc. passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
M/I Homes

A-Score: 5.4/10

Value: 8.0

Growth: 8.2

Quality: 7.0

Yield: 0.0

Momentum: 3.5

Volatility: 6.0

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Toll Brothers

A-Score: 5.4/10

Value: 6.9

Growth: 7.3

Quality: 6.6

Yield: 2.0

Momentum: 3.5

Volatility: 6.3

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Stock-Card
Meritage Homes

A-Score: 5.4/10

Value: 8.6

Growth: 5.3

Quality: 6.5

Yield: 4.0

Momentum: 2.5

Volatility: 5.7

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Taylor Morrison

A-Score: 5.1/10

Value: 8.0

Growth: 5.7

Quality: 6.4

Yield: 0.0

Momentum: 3.5

Volatility: 7.0

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Stock-Card
Century Communities

A-Score: 5.1/10

Value: 8.0

Growth: 7.6

Quality: 4.7

Yield: 3.0

Momentum: 2.0

Volatility: 5.3

1-Year Total Return ->

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KB Home

A-Score: 4.9/10

Value: 7.8

Growth: 4.6

Quality: 5.3

Yield: 3.0

Momentum: 2.5

Volatility: 6.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

145.4$

Current Price

145.4$

Potential

-0.00%

Expected Cash-Flows