KB Home (KBH) closed at $49.22 in the latest trading session, marking a +1.28% move from the prior day. This move outpaced the S&P 500's daily gain of 0.61%. On the other hand, the Dow registered a loss of 0.23%, and the technology-centric Nasdaq increased by 1.19%.
The homebuilder's shares have seen a decrease of 12.31% over the last month, not keeping up with the Construction sector's loss of 2.89% and the S&P 500's gain of 4.44%.
The investment community will be paying close attention to the earnings performance of KB Home in its upcoming release. In that report, analysts expect KB Home to post earnings of $0.44 per share. This would mark a year-over-year decline of 70.67%. Our most recent consensus estimate is calling for quarterly revenue of $1.09 billion, down 28.72% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $3.1 per share and revenue of $5.02 billion, which would represent changes of -52.45% and -19.44%, respectively, from the prior year.
It's also important for investors to be aware of any recent modifications to analyst estimates for KB Home. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional 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 witnessed a 1.2% decrease. KB Home presently features a Zacks Rank of #4 (Sell).
In the context of valuation, KB Home is at present trading with a Forward P/E ratio of 15.7. This expresses a premium compared to the average Forward P/E of 13.53 of its industry.
Investors should also note that KBH has a PEG ratio of 8.58 right now. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The average PEG ratio for the Building Products - Home Builders industry stood at 1.72 at the close of the market yesterday.
The Building Products - Home Builders industry is part of the Construction sector. At present, this industry carries a Zacks Industry Rank of 222, placing it within the bottom 10% of over 250 industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. 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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This article originally published on Zacks Investment Research (zacks.com).