Shares of KB Home
The company reported its results amid an exciting earnings season. Here are some key analyst takeaways.
RBC Capital Markets On KB Home
Analyst Mike Dahl reiterated a Sector Perform rating, while reducing the price target from $67 to $63.
KB Home reported soft quarterly results, with orders down 17% year-on-year versus its "roughly flat" guidance, Dahl said in a note. While a miss was expected, the magnitude was much higher than feared, he added.
Management cut its full-year gross margin guide to 19.2%-20.0%, from their prior projection of 20%-21%, with the fiscal second-quarter guidance of 19.1%-19.5% coming in below consensus of 20.1%, the analyst stated. The company's guidance could still "prove optimistic in a softer/competitive environment with potential increased cost pressures," he wrote.
Keefe, Bruyette & Woods On KB Home
Analyst Jade Rahmani maintained a Market Perform rating and price target of $76.
KB Home's earnings of $1.49 per share missed consensus of $1.57 per share, with deliveries of 2,770 units declining by a higher-than-expected 9% year-on-year, Rahmani said. The company's fiscal second-quarter guidance implies a midpoint of earnings of $1.45 per share versus estimates of $1.89 per share, he added.
Management lowered their full-year housing revenue from $7.0-$7.5 billion to $6.6-$7.0 billion, average selling prices from $488,000-$498,000 to $480,000-$495,000, and gross margins from 20%-21% to 19.2%-20.0%, the analyst stated. "This implies midpoint EPS of approx. $7.22 vs. our $8.25E," he further wrote.
KBH Price Action: Shares of KB Home were down 3% to $59.91 at the time of publication Tuesday.