Zacks Investment Research upgraded shares of KB Home (NYSE:KBH) from a hold rating to a strong-buy rating in a research report sent to investors on Tuesday morning. They currently have $39.00 price objective on the construction company’s stock.
According to Zacks, “KB Home has formulated the right strategy to boost scale in existing geographic footprint, improve profitability per unit, generate higher operating margin and drive earnings, while simultaneously generating positive cash flow to invest in growth and debt reduction. The company reported an impressive 23% growth in revenues, double-digit increase in deliveries and 41% surge in net income, in the first nine months of 2017. The upside was primarily driven by an ongoing housing market recovery and favorable industry fundamentals. The company expects the uptrend to continue to 2018. KB Home shares have widely outperformed the homebuilding industry, in the last one year. Also, the trend in 2018 earnings estimate revisions is satisfactory. Estimates moved upward over the past 30 days, reflecting analysts’ optimism. However, higher construction and labor costs, rising interest rate as well as competitive pricing pressures raise concern.”
Several other research firms also recently weighed in on KBH. Wedbush downgraded KB Home from an outperform rating to a neutral rating in a report on Thursday, October 19th. Keefe, Bruyette & Woods reissued a hold rating and issued a $24.00 target price on shares of KB Home in a report on Friday, September 29th. MKM Partners reissued a neutral rating and issued a $26.00 target price (up from $24.00) on shares of KB Home in a report on Monday, October 2nd. JPMorgan Chase & Co. reissued an underweight rating and issued a $27.00 target price (up from $25.50) on shares of KB Home in a report on Tuesday, December 19th. Finally, KeyCorp reissued a hold rating on shares of KB Home in a report on Tuesday, September 26th. Seven equities research analysts have rated the stock with a sell rating, ten have assigned a hold rating, one has given a buy rating and two have issued a strong buy rating to the company. The company presently has an average rating of Hold and a consensus price target of $26.25.
KB Home (NYSE:KBH) last posted its earnings results on Wednesday, January 10th. The construction company reported $0.84 earnings per share for the quarter, beating the Thomson Reuters’ consensus estimate of $0.77 by $0.07. KB Home had a return on equity of 9.93% and a net margin of 4.13%. The business had revenue of $1.40 billion during the quarter, compared to the consensus estimate of $1.36 billion. During the same period in the previous year, the business earned $0.40 EPS. The business’s quarterly revenue was up 17.7% on a year-over-year basis. sell-side analysts forecast that KB Home will post 2.37 earnings per share for the current year.
A number of institutional investors and hedge funds have recently bought and sold shares of the business. Vanguard Group Inc. raised its stake in KB Home by 7.7% during the 2nd quarter. Vanguard Group Inc. now owns 6,884,880 shares of the construction company’s stock valued at $165,031,000 after acquiring an additional 492,594 shares during the last quarter. Dimensional Fund Advisors LP raised its stake in KB Home by 16.4% during the 2nd quarter. Dimensional Fund Advisors LP now owns 2,803,374 shares of the construction company’s stock valued at $67,196,000 after acquiring an additional 394,584 shares during the last quarter. State Street Corp raised its stake in KB Home by 3.2% during the 2nd quarter. State Street Corp now owns 2,665,501 shares of the construction company’s stock valued at $63,890,000 after acquiring an additional 83,179 shares during the last quarter. Capital World Investors raised its stake in KB Home by 30.1% during the 2nd quarter. Capital World Investors now owns 2,117,000 shares of the construction company’s stock valued at $50,744,000 after acquiring an additional 490,000 shares during the last quarter. Finally, Northern Trust Corp raised its stake in KB Home by 1.9% during the 2nd quarter. Northern Trust Corp now owns 1,337,380 shares of the construction company’s stock valued at $32,058,000 after acquiring an additional 25,523 shares during the last quarter. 96.73% of the stock is owned by hedge funds and other institutional investors.
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About KB Home
KB HOME is a homebuilding company. The Company is engaged in selling and building a range of new homes designed primarily for first-time, move-up and active adult homebuyers, including attached and detached single-family residential homes. It operates through five segments, which consist of four homebuilding segments and one financial services segment.
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