KB Home (KBH) Falls More Steeply Than Broader Market: What Investors Need to Know

KB Home (KBH) closed the most recent trading day at $60.52, moving -1.06% from the previous trading session. This change lagged the S&P 500's 0.94% loss on the day. Elsewhere, the Dow saw a downswing of 0.83%, while the tech-heavy Nasdaq depreciated by 1.02%.

The homebuilder's shares have seen an increase of 6.27% over the last month, surpassing the Construction sector's gain of 6.21% and the S&P 500's loss of 1.3%.

Market participants will be closely following the financial results of KB Home in its upcoming release. The company is forecasted to report an EPS of $0.53, showcasing a 64.43% downward movement from the corresponding quarter of the prior year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.11 billion, down 20.57% from the year-ago period.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $4.19 per share and a revenue of $5.59 billion, indicating changes of -35.74% and -10.38%, respectively, from the former year.

Investors should also note any recent changes to analyst estimates for KB Home. Such recent modifications usually signify the changing landscape of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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, 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 moved 1.02% higher. As of now, KB Home holds a Zacks Rank of #4 (Sell).

Valuation is also important, so investors should note that KB Home has a Forward P/E ratio of 14.61 right now. This signifies a premium in comparison to the average Forward P/E of 14.22 for its industry.

One should further note that KBH currently holds a PEG ratio of 7.99. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As of the close of trade yesterday, the Building Products - Home Builders industry held an average PEG ratio of 1.73.

The Building Products - Home Builders industry is part of the Construction sector. At present, this industry carries a Zacks Industry Rank of 232, placing it within the bottom 6% of over 250 industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.