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Why the Market Dipped But KB Home (KBH) Gained Today

KB Home (KBH) closed at $61.69 in the latest trading session, marking a +0.69% move from the prior day. The stock outperformed the S&P 500, which registered a daily loss of 0.6%. At the same time, the Dow lost 0.17%, and the tech-heavy Nasdaq lost 0.92%.

Coming into today, shares of the homebuilder had lost 2.7% in the past month. In that same time, the Construction sector gained 4.17%, while the S&P 500 gained 3.56%.

Analysts and investors alike will be keeping a close eye on the performance of KB Home in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $1.56, marking a 7.59% rise compared to the same quarter of the previous year. In the meantime, our current consensus estimate forecasts the revenue to be $1.45 billion, indicating a 4.81% growth compared to the corresponding quarter of the prior year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $7.59 per share and revenue of $6.69 billion. These totals would mark changes of +7.97% and +4.35%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for KB Home. These revisions typically reflect the latest short-term business trends, which can change frequently. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.85% higher. Currently, KB Home is carrying a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that KB Home has a Forward P/E ratio of 8.08 right now. This denotes a discount relative to the industry's average Forward P/E of 8.66.

We can also see that KBH currently has a PEG ratio of 0.75. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Building Products - Home Builders industry had an average PEG ratio of 0.8 as trading concluded yesterday.

The Building Products - Home Builders industry is part of the Construction sector. With its current Zacks Industry Rank of 14, this industry ranks in the top 6% of all industries, numbering over 250.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Ensure to harness to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.

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