NYSE:KBH

Stock Analysis Report

Executive Summary

KB Home operates as a homebuilding company in the United States.


Snowflake Analysis

Good value with proven track record.


Similar Companies

Share Price & News

How has KB Home's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: KBH has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-11.4%

KBH

-9.3%

US Consumer Durables

-7.6%

US Market


1 Year Return

52.9%

KBH

19.0%

US Consumer Durables

10.2%

US Market

Return vs Industry: KBH exceeded the US Consumer Durables industry which returned 19% over the past year.

Return vs Market: KBH exceeded the US Market which returned 10.2% over the past year.


Shareholder returns

KBHIndustryMarket
7 Day-11.4%-9.3%-7.6%
30 Day-7.6%-8.3%-4.5%
90 Day1.4%-1.8%-0.6%
1 Year54.3%52.9%20.6%19.0%12.5%10.2%
3 Year99.9%96.4%19.2%13.7%37.1%28.3%
5 Year162.5%154.3%28.3%19.6%60.8%43.2%

Price Volatility Vs. Market

How volatile is KB Home's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is KB Home undervalued compared to its fair value and its price relative to the market?

18.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: KBH ($35.37) is trading below our estimate of fair value ($43.62)

Significantly Below Fair Value: KBH is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: KBH is good value based on its PE Ratio (11.7x) compared to the Consumer Durables industry average (12.4x).

PE vs Market: KBH is good value based on its PE Ratio (11.7x) compared to the US market (17.1x).


Price to Earnings Growth Ratio

PEG Ratio: KBH is good value based on its PEG Ratio (0.8x)


Price to Book Ratio

PB vs Industry: KBH is overvalued based on its PB Ratio (1.3x) compared to the US Consumer Durables industry average (1.3x).


Next Steps

Future Growth

How is KB Home forecast to perform in the next 1 to 3 years based on estimates from 12 analysts?

14.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: KBH's forecast earnings growth (14.4% per year) is above the savings rate (1.7%).

Earnings vs Market: KBH's earnings (14.4% per year) are forecast to grow faster than the US market (13.2% per year).

High Growth Earnings: KBH's earnings are forecast to grow, but not significantly.

Revenue vs Market: KBH's revenue (9.1% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: KBH's revenue (9.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: KBH's Return on Equity is forecast to be low in 3 years time (11.2%).


Next Steps

Past Performance

How has KB Home performed over the past 5 years?

-36.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: KBH has high quality earnings.

Growing Profit Margin: KBH's current net profit margins (5.9%) are higher than last year (3.7%).


Past Earnings Growth Analysis

Earnings Trend: KBH's earnings have declined by -36.7% per year over the past 5 years.

Accelerating Growth: KBH's earnings growth over the past year (57.7%) exceeds its 5-year average (-36.7% per year).

Earnings vs Industry: KBH earnings growth over the past year (57.7%) exceeded the Consumer Durables industry 9%.


Return on Equity

High ROE: KBH's Return on Equity (11.3%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is KB Home's financial position?


Financial Position Analysis

Short Term Liabilities: KBH's short term assets ($4.4B) exceed its short term liabilities ($794.2M).

Long Term Liabilities: KBH's short term assets ($4.4B) exceed its long term liabilities ($1.8B).


Debt to Equity History and Analysis

Debt Level: KBH's debt to equity ratio (73.4%) is considered high.

Reducing Debt: KBH's debt to equity ratio has reduced from 161.6% to 73.4% over the past 5 years.

Debt Coverage: KBH's debt is not well covered by operating cash flow (14.4%).

Interest Coverage: KBH earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: KBH has a high level of physical assets or inventory.

Debt Coverage by Assets: KBH's debt is covered by short term assets (assets are 2.5x debt).


Next Steps

Dividend

What is KB Home's current dividend yield, its reliability and sustainability?

1.02%

Current Dividend Yield


Dividend Yield vs Market

company1.0%marketbottom25%1.5%markettop25%4.0%industryaverage2.1%forecastin3Years1.0%

Current dividend yield vs market & industry

Notable Dividend: KBH's dividend (1.02%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.53%).

High Dividend: KBH's dividend (1.02%) is low compared to the top 25% of dividend payers in the US market (3.96%).


Stability and Growth of Payments

Stable Dividend: KBH's dividend payments have been volatile in the past 10 years.

Growing Dividend: KBH's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (7.6%), KBH's dividend payments are thoroughly covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: KBH's dividends in 3 years are forecast to be thoroughly covered by earnings (8.8% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

9.7yrs

Average management tenure


CEO

Jeff Mezger (63yo)

13.3yrs

Tenure

US$11,934,897

Compensation

Mr. Jeffrey T. Mezger, also known as Jeff, has been the Chief Executive Officer and President of KB Home since November 12, 2006 and has been its Chairman since August 17, 2016. As a respected industry voi ...


CEO Compensation Analysis

Compensation vs Market: Jeff's total compensation ($USD11.93M) is above average for companies of similar size in the US market ($USD4.98M).

Compensation vs Earnings: Jeff's compensation has increased by more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Jeffrey Mezger
Chairman13.3yrsUS$11.93m1.1% $34.9m
Jeff Kaminski
Executive VP & CFO9.7yrsUS$3.60m0.13% $4.2m
Matthew Mandino
Executive VP & COO1.7yrsUS$5.04m0.020% $633.2k
Brian Woram
Executive VP & General Counsel9.6yrsUS$2.63m0.15% $4.7m
Albert Praw
Executive Vice President of Real Estate & Business Development18.1yrsUS$2.78m0.13% $4.3m
William Hollinger
Senior VP & Chief Accounting Officer13.1yrsUS$1.68m0.18% $5.8m
Dan Bridleman
Senior Vice President of Sustainability0yrsno datano data
Jill Peters
Senior Vice President of Investor Relations4.1yrsno datano data
Amit Desai
Senior VP & Chief Marketing Officer0.3yrsno datano data
Thomas Norton
Senior Vice President of Human Resources11.1yrsno datano data

9.7yrs

Average Tenure

58yo

Average Age

Experienced Management: KBH's management team is seasoned and experienced (9.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Jeffrey Mezger
Chairman13.3yrsUS$11.93m1.1% $34.9m
Robert Johnson
Independent Director11.6yrsUS$267.00k0.085% $2.7m
Kenneth Jastrow
Independent Director18.2yrsUS$263.00k0.015% $471.6k
Timothy Finchem
Independent Director14.8yrsUS$257.00k0.19% $6.2m
Melissa Lora
Lead Independent Director3.3yrsUS$302.00k0.0023% $72.3k
Stuart Gabriel
Independent Director3.8yrsUS$255.00k0.031% $991.1k
James Weaver
Independent Director2.3yrsUS$262.00k0.018% $555.0k
Dorene Dominguez
Independent Director2.6yrsUS$260.00k0.015% $489.0k
Thomas Gilligan
Independent Director7.6yrsUS$275.00k0.055% $1.7m
Michael Wood
Independent Director6.1yrsUS$260.00k0.054% $1.7m

5.0yrs

Average Tenure

64.5yo

Average Age

Experienced Board: KBH's board of directors are considered experienced (5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: KBH insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

KB Home's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: KB Home
  • Ticker: KBH
  • Exchange: NYSE
  • Founded: 1957
  • Industry: Homebuilding
  • Sector: Consumer Durables
  • Market Cap: US$3.169b
  • Shares outstanding: 89.61m
  • Website: https://www.kbhome.com

Number of Employees


Location

  • KB Home
  • 10990 Wilshire Boulevard
  • 7th Floor
  • Los Angeles
  • California
  • 90024
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
KBHNYSE (New York Stock Exchange)YesCommon StockUSUSDAug 1986
KBHDB (Deutsche Boerse AG)YesCommon StockDEEURAug 1986
KBH *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNAug 1986

Biography

KB Home operates as a homebuilding company in the United States. It operates through four segments: West Coast, Southwest, Central, and Southeast. The company builds and sells various homes, including attached and detached single-family residential homes, townhomes, and condominiums primarily for first-time, first move-up, second move-up, and active adult homebuyers. It also offers financial services, such as insurance products and title services. It has operations in Arizona, California, Colorado, Florida, Nevada, North Carolina, Texas, and Washington. The company was formerly known as Kaufman and Broad Home Corporation and changed its name to KB Home in January 2001. KB Home was founded in 1957 and is headquartered in Los Angeles, California. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/26 23:55
End of Day Share Price2020/02/26 00:00
Earnings2019/11/30
Annual Earnings2019/11/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.