KBH Investment Analysis Report & Stock Research, KB Home

KB Home (KBH)

KBH Stock Report

2-Year Price History

View Larger KBH Chart
NYSE:KBH
$17.64
(3/18 4:00PM)
-0.1%
Open$17.61 Mkt Cap$1.6 Billion
High$17.85 52Wk High$20.70
Low$17.44 52Wk Low$11.15
Volume1.7 Million Avg Vol 10D2.4 Million

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KBH Revenue

As a value investing shop, we are interested in seeing how KBH's revenues measure up against past performances. One easily understandable way of doing that is to compare Price to Sales per share levels over a given time frame. Assuming it is available, Ockham prefers to look at ten years of history (for this stock there are 10 years of history available) and we weigh recent years more heavily. This allows us to find weighted average historical high and low Price to Sales ratios, which give us a better idea of the stock's current underlying value. Using this method, we have established a high range for Price to Sales of 0.93x and the low end of the range at 0.38x.

With respect to these historically rational metrics, notice that the current Price to Sales per share ratio for KBH of 0.84x is well above its historical average. This means that KBH looks relatively expensive compared to its historical Price to Sales average, and thus it is more difficult to believe that there is significant price appreciation potential. In order for the stock to become more attractive, we would like to see a decline in the Price to Sales ratio of 28% just to return KBH to its historical average.

KBH Cash Earnings

KBH is not forecasted to produce positive Cash Earnings this year, based on recent performance. This is not a positive situation, as we would always prefer that a company is producing cash every year. However, it is important to recognize that not all companies or types of companies have the goal of producing positive Cash Earnings either early in their business cycle or following significant turnaround changes. When looking at KBH, we hesitate to be overly negative on the company, but it is of concern that the company is not profitable at this time. Let's face it, companies cannot remain unprofitable for very long before a change has to be made. This could mean further restructuring or corporate event such as selling assets or spinning off divisions, at any rate a company with negative cash flows is not one that often makes a great investment unless you can acquire it at an extremely depressed price.

KBH Dividends

A positive Ockham rating does not require a company to pay out an inviting dividend or a dividend at all. However, we believe dividends provide a useful measure of a company's inherent expectations.

Comparable to our analysis of Sales and Cash Earnings per share, we examine dividend yields from KBH against the historic high and low levels over an available data range. Because KBH has an established history of paying a dividend to shareholders, there is value in comparing recent dividends to historical dividends. In KBH’s case, the estimated annual dividend is $0.25 producing a current dividend yield of 1.43%. The highest dividend yield from KBH in recent history was 11.74% while the lowest dividend yield was 0.42%. While it is quite common for a growth stock to pay no dividend at all, but for a mature company such as KBH that has a history of paying dividends it is disappointing to see their dividend yield drop so significantly. At this time, the current dividend yield is 76.48% below the median yield.

Peer Comparison

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KB Home Industry Grouping

(3/17/2010)
Company Ticker Market Cap (Ml) Latest
Price
Price/Cash Earnings Price/Sales 5-Yr. Rev.
Growth Rate
5-Yr.
Avg. ROE.
Current 10-Yr. Range* Current 10-Yr. Range*
Peer Company Averages (not including KBH) 18.11 2.94 » 27.71 0.82 0.16 » 1.44 0.98% 11.97%
*10 year range does not include current year values
Emcor Group, Inc. EME $1.7 Billion $26.03 7.92 3.14 » 18.93 0.30 0.10 » 0.43 3.16% 13.44%
M.D.C. Holdings, Inc. MDC $1.7 Billion $35.56 42.52 3.07 » 47.24 1.85 0.26 » 2.05 -25.86% 7.46%
KB Home KBH $1.6 Billion $17.65 -1.00 4.80 » 14.47 0.84 0.20 » 1.00 -23.59% 8.84%
Clean Harbors, Inc. CLH $1.5 Billion $57.31 15.16 0.99 » 27.45 1.37 0.07 » 1.91 11.03% 21.60%
Empresas ICA SA de CV ICA $1.2 Billion $10.08 17.77 3.62 » 27.10 0.04 0.07 » 1.74 18.24% 4.19%
Granite Construction Inc. GVA $1.2 Billion $30.05 7.18 3.87 » 17.83 0.56 0.30 » 1.07 -1.67% 13.14%
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2:54P, Mar. 09,2010 KBH $17.73 KB Home
Street Signs

KB Home News Appeared on Street Signs

Staying informed on the news is invaluable for investors, and RazorWire has captured a recently discussion on KBH from Street Signs.

The latest news on KBH has created quite a stir as the stock is trading $1.01 higher in today's session. We noticed recently that in comparison to all other stocks we analyze in the news; KBH has received less coverage from the financial media in business television and blogs. At the current price, value investors will want to look elsewhere for a buying opportunity as this stock has heated up and is currently Overvalued. While bearish sentiment on a stock is not always a bad thing, it is something you need to be aware of. The Motley Fool survey of crowd sentiment shows that many investors believe this stock will underperform.

“… KB HOMES attempts to charge up the market with an option to wire its new homes with electric charging vehicle stations. Erin? > > thanks very much. > > > …”

12:02P, Mar. 08,2010 KBH $17.46 KB Home
Power Lunch

Power Lunch: Will KBH Test Its 52-week High?

Stick with it or dump it? Power Lunch discusses what an abnormally high price means for KBH's investors. Take note of Ockham's valaution on the stock as well.

When taking into account the amount of news coverage each stock normally sees as a percentage of the total, KB Home has actually sunk a bit in comparison to the others. Interestingly, overall sentiment looks bearish according to the Motley Fool's CAPS survey, as most of their users see KB Home underperforming. As of this week's report, we have an Overvalued valuation on KBH because the price has gotten too high to be justified by the fundamentals.

“… Pulte homes and KB HOMES advancing. Sector advances, tell come stocks having nice day. Sprint having one of the nicest days in a while. Not a lot of news associated with that. …”

3:46P, Feb. 16,2010 KBH $16.98 KB Home
Closing Bell

Sales Growth at KB Home Discussed on Closing Bell

Sales growth is an absolutely essential metric to understand when researching a stock. Today, KBH's sales growth was the topic on Closing Bell.

At the current price, value investors will want to look elsewhere for a buying opportunity as this stock has heated up and is currently Overvalued. While bearish sentiment on a stock is not always a bad thing, it is something you need to be aware of. The Motley Fool survey of crowd sentiment shows that many investors believe this stock will underperform. We noticed recently that in comparison to all other stocks we analyze in the news; KBH has received less coverage from the financial media in business television and blogs.

“… same store sales. KB HOME upgraded from a neutral to sell. Citing the home builder's exposure to first-time home buyers. …”

12:48P, Jan. 19,2010 KBH $15.40 KB Home
Fox Business

KB Home News Appeared on Fox Business

As always, the latest news on KBH is available to Ockham clients through RazorWire, and it was mentioned recently on Fox Business.

At the current price, value investors will want to look elsewhere for a buying opportunity as this stock has heated up and is currently Overvalued. Ranking all stocks in terms of news coverage offers some interesting data. In the case of KBH, it is getting significantly more attention in recent news coverage than we are used to seeing. While bearish sentiment on a stock is not always a bad thing, it is something you need to be aware of. The Motley Fool survey of crowd sentiment shows that many investors believe this stock will underperform.

“… Look at KB HOMES. A lot of those companies and those builders have big operations there. And the stocks are all trading higher right now. …”

4:03P, Jan. 12,2010 KBH $15.72 KB Home
Closing Bell

KB Home EPS: A Hot Topic on Closing Bell

Whenever a reliable source like Closing Bell talks about earnings or news on earnings, we think it warrants bringing attention to it.

When taking into account the amount of news coverage each stock normally sees as a percentage of the total, KB Home has actually sunk a bit in comparison to the others. Interestingly, overall sentiment looks bearish according to the Motley Fool's CAPS survey, as most of their users see KB Home underperforming. As of this week's report, we have an Overvalued valuation on KBH because the price has gotten too high to be justified by the fundamentals.

“… KB HOME slid today. It wouldn't make any money in the first quarter. The hartford is to the upside. It had a pretty good day as it raised its outlook. …”

3:03P, Jan. 12,2010 KBH $15.58 KB Home
Closing Bell

Look Out for KB Home: Its Very Active in the News

Something important is going on with KBH today, as it is getting a lot of attention on business television and influential blogs.

Interestingly, overall sentiment looks bearish according to the Motley Fool's CAPS survey, as most of their users see KB Home underperforming. As of this week's report, we have an Overvalued valuation on KBH because the price has gotten too high to be justified by the fundamentals. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, KB Home has actually sunk a bit in comparison to the others.

“… How about KB HOMES saying they are not going to make any money in the first quarter. The hartford, one of the positive stories. Tiffany says global holiday sales up 17%. …”

12:37P, Jan. 12,2010 KBH $15.18 KB Home
Fox Business

Look Out for KB Home: Its Very Active in the News

Something important is going on with KBH today, as it is getting a lot of attention on business television and influential blogs.

As of this week's report, we have an Overvalued valuation on KBH because the price has gotten too high to be justified by the fundamentals. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, KB Home has actually sunk a bit in comparison to the others. Interestingly, overall sentiment looks bearish according to the Motley Fool's CAPS survey, as most of their users see KB Home underperforming.

“… Last but not least KB HOMES cannot with fourth quarter of that tax benefits making money in the first quarter and as a result KB HOMES is down and other home builders so the ... …”

9:46A, Jan. 12,2010 KBH $15.42 KB Home
Squawk On The Street

Squawk On The Street: What is Happening with KB Home Now?

The latest news from Squawk On The Street on KBH is available through Ockham's news analytics platform RazorWire.

At the current price, value investors will want to look elsewhere for a buying opportunity as this stock has heated up and is currently Overvalued. While bearish sentiment on a stock is not always a bad thing, it is something you need to be aware of. The Motley Fool survey of crowd sentiment shows that many investors believe this stock will underperform. We noticed recently that in comparison to all other stocks we analyze in the news; KBH has received less coverage from the financial media in business television and blogs.

“… KB HOMES is making money again. That's the good news. $1. 31 a share, compared to $370 million lost in the same period last year. …”

9:35A, Jan. 12,2010 KBH $15.78 KB Home
Squawk On The Street

KB Home Was Talked About by Squawk On The Street

The latest news on Squawk On The Street in regards to KBH came through on RazorWire recently.

At the current price, value investors will want to look elsewhere for a buying opportunity as this stock has heated up and is currently Overvalued. While bearish sentiment on a stock is not always a bad thing, it is something you need to be aware of. The Motley Fool survey of crowd sentiment shows that many investors believe this stock will underperform. We noticed recently that in comparison to all other stocks we analyze in the news; KBH has received less coverage from the financial media in business television and blogs.

“… Finally, KB HOME, revenues fell. They say housing may be stabilizing in some regions. Stocks lower. Let's go to matt nesto at the nasdaq. > > scott, thank you very much. …”

9:30A, Jan. 12,2010 KBH $15.92 KB Home
Squawk On The Street

See More News on KBH from Squawk On The Street

Staying informed on the news is invaluable for investors, and RazorWire has captured a recently discussion on KBH from Squawk On The Street.

While bearish sentiment on a stock is not always a bad thing, it is something you need to be aware of. The Motley Fool survey of crowd sentiment shows that many investors believe this stock will underperform. At the current price, value investors will want to look elsewhere for a buying opportunity as this stock has heated up and is currently Overvalued. We noticed recently that in comparison to all other stocks we analyze in the news; KBH has received less coverage from the financial media in business television and blogs.

“… KB HOMES close to quarterly profit. Earning $100 million. That's $1. 31 a share. Cheesecake factory. Oh, we love the cheesecake factory. …”

View All KB Home Stock News

Key Fundamentals

KBH - KB Home Fundamentals
Price (3/18 4:00PM) $17.64
Volume (3/18 4:00PM) 1.7 Million
Last Close Price $17.65
10 Day Average Volume 2.4 Million
13 Week Price Range $12.74 - $18.05
52 Week Price Range $11.15 - $20.70
LTM Revenue $1.8 Billion
 
Shares Outstanding (11/2009) 88.1 Million
Market Capitalization $1.6 Billion
Shares Held By Institutions 93.3 Million
Institutional Holders 323
% Shares Held By Institutions %
Earnings Per Share (EPS) ($1.33)
P/E Ratio n/a
Book Value Per Share $8.03
 
Gross Margin 4.30%
Annual Dividend 0.25
Dividend Yield 1.40%
Beta 1.67
Fiscal Year Ends November

About KB Home

KB Home is considered to operate in the Industrial Goods sector. They specifically operate in the Residential Construction business segment contained within the Materials & Construction industry.

The Company constructs and sells homes through its operating divisions across the United States under the name KB Home. It operates a homebuilding and financial services business serving homebuyers in markets nationwide.