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In the latest trading session, KB Home (KBH) closed at $56, marking a -0.23% move from the previous day. This change lagged the S&P 500's 0.73% gain on the day. On the other hand, the Dow registered a loss of 0.64%, and the technology-centric Nasdaq increased by 1.61%.
Coming into today, shares of the homebuilder had gained 10.02% in the past month. In that same time, the Construction sector gained 13.93%, while the S&P 500 gained 9.07%.
The upcoming earnings release of KB Home will be of great interest to investors. The company's earnings per share (EPS) are projected to be $1.45, reflecting a 32.56% decrease from the same quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.5 billion, down 12.55% from the year-ago period.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $7.05 per share and a revenue of $6.64 billion, representing changes of -16.57% and -4.11%, respectively, from the prior year.
Any recent changes to analyst estimates for KB Home should also be noted by investors. These latest adjustments often mirror the shifting dynamics of short-term business patterns. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical 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 past month, the Zacks Consensus EPS estimate has moved 4.29% lower. KB Home currently has a Zacks Rank of #4 (Sell).
In terms of valuation, KB Home is presently being traded at a Forward P/E ratio of 7.96. For comparison, its industry has an average Forward P/E of 9.82, which means KB Home is trading at a discount to the group.
Meanwhile, KBH's PEG ratio is currently 2.54. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. By the end of yesterday's trading, the Building Products - Home Builders industry had an average PEG ratio of 1.32.
The Building Products - Home Builders industry is part of the Construction sector. This industry currently has a Zacks Industry Rank of 235, which puts it in the bottom 5% of all 250+ industries.