The time has not yet come to remove your chips from the table: KB Home (KBH)

KB Home (NYSE: KBH) stock jumped 1.63% on Thursday to $44.31 against a previous-day closing price of $43.60. With 0.97 million shares changed hands, the volume of the stock remained lighter than its average volume of 1.7 million shares. The 52-week range on KBH shows that it touched its highest point at $46.91 and its lowest point at $24.78 during that stretch. It currently has a 1-year price target of $43.91. With its current market cap of 3.74 billion, KBH has annualized dividend of $0.60 while the current yield stands at 1.35%. Beta for the stock currently stands at 1.60.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of KBH was down-trending over the past week, with a drop of -3.74%, but this was up by 7.86% over a month. Three-month performance surged to 25.88% while six-month performance rose 46.09%. The stock gained 41.25% in the past year, while it has gained 39.12% so far this year. A look at the trailing 12-month EPS for KBH yields 9.15 with Next year EPS estimates of 5.60. For the next quarter, that number is 1.31. This implies an EPS growth rate of 51.40% for this year and 1.54% for next year. EPS is expected to decline by -11.90% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 37.50%.

Float and Shares Shorts:

At present, 83.47 million KBH shares are outstanding with a float of 69.52 million shares on hand for trading. On May 14, 2023, short shares totaled 5.7 million, which was 6.91% higher than short shares on Apr 13, 2023. In addition to Mr. Jeffrey T. Mezger as the firm’s Chairman, Pres & CEO, Mr. Jeff J. Kaminski serves as its Exec. VP & CFO.

Institutional Ownership:

Through their ownership of 95.63% of KBH’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 8.37% of KBH, in contrast to 56.83% held by mutual funds. Shares owned by individuals account for 40.17%. As the largest shareholder in KBH with 10.85% of the stake, BlackRock Fund Advisors holds 8,951,608 shares worth 8,951,608. A second-largest stockholder of KBH, The Vanguard Group, Inc., holds 7,546,074 shares, controlling over 9.15% of the firm’s shares. Fidelity Management & Research Co is the third largest shareholder in KBH, holding 6,138,502 shares or 7.44% stake. With a 3.72% stake in KBH, the Fidelity Small Cap Value Fund is the largest stakeholder. A total of 3,065,000 shares are owned by the mutual fund manager. The American Funds Small Cap World Fu, which owns about 3.59% of KBH stock, is the second-largest Mutual Fund holder. It holds 2,957,918 shares valued at 129.62 million. iShares Core S&P Mid Cap ETF holds 3.09% of the stake in KBH, owning 2,547,173 shares worth 111.62 million.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Feb 27, 2023, KBH reported revenue of $1.72B and operating income of $268.33M. The EBITDA in the recently reported quarter was $282.87M and diluted EPS was $2.32.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for KBH since 0 analysts follow the stock currently. In the same way, a target price assigned to a stock can also reveal much about its potential. With KBH analysts setting a high price target of $56.00 and a low target of $29.00, the average target price over the next 12 months is $43.77. Based on these targets, KBH could surge 26.38% to reach the target high and fall by -34.55% to reach the target low. Reaching the average price target will result in a decline of -1.22% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy.

Summary of Insider Activity:

Insiders traded KBH stock several times over the past three months with 0 Buys and 1 Sells. In these transactions, 0 shares were bought while 2,100 shares were sold. The number of buy transactions has increased to 8 while that of sell transactions has risen to 8 over the past year. The total number of shares bought during that period was 539,577 while 249,608 shares were sold.

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