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KB Home (KBH) Ascends While Market Falls: Some Facts to Note

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KB Home (KBH - Free Report) closed at $62.83 in the latest trading session, marking a +1.18% move from the prior day. The stock's performance was ahead of the S&P 500's daily loss of 0.43%. At the same time, the Dow lost 1.01%, and the tech-heavy Nasdaq lost 0.47%.

Heading into today, shares of the homebuilder had lost 8.47% over the past month, lagging the Construction sector's loss of 5.29% and the S&P 500's gain of 2.6% in that time.

The investment community will be paying close attention to the earnings performance of KB Home in its upcoming release. The company is forecasted to report an EPS of $1.58, showcasing a 10.23% downward movement from the corresponding quarter of the prior year. Simultaneously, our latest consensus estimate expects the revenue to be $1.5 billion, showing a 2.37% escalation compared to the year-ago quarter.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $8.42 per share and revenue of $7.21 billion. These totals would mark changes of -0.36% and +3.98%, respectively, from last year.

Investors should also take note of any recent adjustments to analyst estimates for KB Home. These revisions help to show the ever-changing nature of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 2.92% decrease. Right now, KB Home possesses a Zacks Rank of #4 (Sell).

Digging into valuation, KB Home currently has a Forward P/E ratio of 7.38. This indicates a discount in contrast to its industry's Forward P/E of 7.94.

Meanwhile, KBH's PEG ratio is currently 0.89. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Building Products - Home Builders industry currently had an average PEG ratio of 0.91 as of yesterday's close.

The Building Products - Home Builders industry is part of the Construction sector. This industry, currently bearing a Zacks Industry Rank of 244, finds itself in the bottom 3% echelons of all 250+ industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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