S&P Global Ratings upgraded Meritage Homes Corp.'s corporate credit rating and the issue-level rating on the company's senior unsecured notes to BB from BB-, with a stable outlook.
According to a note, the upgrade reflects the company's ability to maintain its debt-to-EBITDA ratio of under 4x for over four years while growing its community count, closings and EBITDA during the period. The rating agency also anticipates that leverage will remain under 4x and that the company will uphold its position as a top-10 builder in the U.S.
The stable outlook mirrors the rating agency's opinion that the company will maintain debt-to-EBITDA below 4x while aggressively upsizing its platform over the next 12 to 24 months.
S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.