KB Home (KBH) Outpaces Stock Market Gains: What You Should Know

KB Home (KBH) closed the most recent trading day at $66.12, moving +0.79% from the previous trading session. The stock's change was more than the S&P 500's daily gain of 0.32%. On the other hand, the Dow registered a gain of 0.38%, and the technology-centric Nasdaq increased by 0.35%.

The the stock of homebuilder has fallen by 7.45% in the past month, lagging the Construction sector's loss of 5.38% and the S&P 500's loss of 2%.

Analysts and investors alike will be keeping a close eye on the performance of KB Home in its upcoming earnings disclosure. The company is forecasted to report an EPS of $1.79, showcasing a 7.73% downward movement from the corresponding quarter of the prior year. Meanwhile, the latest consensus estimate predicts the revenue to be $1.64 billion, indicating a 7.1% decrease compared to the same quarter of the previous year.

KBH's full-year Zacks Consensus Estimates are calling for earnings of $8.01 per share and revenue of $6.77 billion. These results would represent year-over-year changes of +13.94% and +5.55%, respectively.

It is also important to note the recent changes to analyst estimates for KB Home. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 2.46% increase. At present, KB Home boasts a Zacks Rank of #1 (Strong Buy).

In terms of valuation, KB Home is currently trading at a Forward P/E ratio of 8.19. Its industry sports an average Forward P/E of 9.21, so one might conclude that KB Home is trading at a discount comparatively.

It is also worth noting that KBH currently has a PEG ratio of 0.74. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. KBH's industry had an average PEG ratio of 0.88 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 33, finds itself in the top 14% echelons of all 250+ industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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