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Byline: Jonah Keri
Meritage zoomed out of a three-month base May 7 on huge volume. The stock flashed a powerful follow-through the next day, but stalled soon after amid a struggling market. After a short consolidation, Meritage took off again, peaking on July 19. It's dropped into a fresh base since then and has recently hugged its 50-day moving average. It's 17% off its high.
The firm builds homes in Arizona, Texas and California. Of the 30 stocks in the Building-Residential/Commercial group, Meritage sports the highest Relative Price Strength Rating, at 97.
Sales growth slowed to 24% in last year's fourth quarter from 77% in the prior quarter. But it's picked up since, rising to 26% and 43% in the last two quarters. Profit growth has surged to 237% and 193% in the last two quarters. Analysts expect earnings for all 2001 to jump 170% ...