In the latest close session, KB Home (KBH) was down 1.07% at $62.21. The stock fell short of the S&P 500, which registered a loss of 0.01% for the day. Meanwhile, the Dow lost 0.08%, and the Nasdaq, a tech-heavy index, added 0.03%.
Heading into today, shares of the homebuilder had gained 16.68% over the past month, outpacing the Construction sector's gain of 7.8% and the S&P 500's gain of 3.47%.
Investors will be eagerly watching for the performance of KB Home in its upcoming earnings disclosure. The company is predicted to post an EPS of $1.56, indicating a 23.53% decline compared to the equivalent quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $1.61 billion, indicating a 8.05% decline compared to the corresponding quarter of the prior year.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $6.55 per share and a revenue of $6.41 billion, representing changes of -22.49% and -7.52%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for KB Home. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Currently, KB Home is carrying a Zacks Rank of #5 (Strong Sell).
Digging into valuation, KB Home currently has a Forward P/E ratio of 9.6. Its industry sports an average Forward P/E of 11.64, so one might conclude that KB Home is trading at a discount comparatively.
It's also important to note that KBH currently trades at a PEG ratio of 5.05. 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 was holding an average PEG ratio of 2.54 at yesterday's closing price.
The Building Products – Home Builders industry is part of the Construction sector. With its current Zacks Industry Rank of 229, this industry ranks in the bottom 8% of all industries, numbering over 250.
