KB HOME (KBH)
US48666K1097 - Common Stock
KBH gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 67 industry peers in the Household Durables industry. While KBH belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. KBH may be a bit undervalued, certainly considering the very reasonable score on growth With these ratings, KBH could be worth investigating further for value investing!.
1. Profitability
1.1 Basic Checks
KBH had positive earnings in the past year.
KBH had a positive operating cash flow in the past year.
KBH had positive earnings in each of the past 5 years.
Of the past 5 years KBH 4 years had a positive operating cash flow.
1.2 Ratios
KBH has a Return On Assets of 10.93%. This is amongst the best in the industry. KBH outperforms 83.08% of its industry peers.
Looking at the Return On Equity, with a value of 18.75%, KBH is in the better half of the industry, outperforming 75.38% of the companies in the same industry.
KBH has a Return On Invested Capital of 12.03%. This is in the better half of the industry: KBH outperforms 70.77% of its industry peers.
KBH had an Average Return On Invested Capital over the past 3 years of 11.87%. This is in line with the industry average of 12.04%.
The 3 year average ROIC (11.87%) for KBH is below the current ROIC(12.03%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.93% | ||
| ROE | 18.75% | ||
| ROIC | 12.03% |
ROA(3y)10.22%
ROA(5y)8.3%
ROE(3y)18.73%
ROE(5y)15.69%
ROIC(3y)11.87%
ROIC(5y)9.52%
1.3 Margins
KBH's Profit Margin of 9.26% is fine compared to the rest of the industry. KBH outperforms 75.38% of its industry peers.
In the last couple of years the Profit Margin of KBH has grown nicely.
The Operating Margin of KBH (11.17%) is better than 63.08% of its industry peers.
In the last couple of years the Operating Margin of KBH has grown nicely.
KBH has a Gross Margin of 21.44%. This is in the lower half of the industry: KBH underperforms 78.46% of its industry peers.
In the last couple of years the Gross Margin of KBH has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.17% | ||
| PM (TTM) | 9.26% | ||
| GM | 21.44% |
OM growth 3Y13.14%
OM growth 5Y8.2%
PM growth 3Y9.06%
PM growth 5Y19.66%
GM growth 3Y3.92%
GM growth 5Y4.04%
2. Health
2.1 Basic Checks
KBH has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for KBH has been reduced compared to 1 year ago.
The number of shares outstanding for KBH has been reduced compared to 5 years ago.
The debt/assets ratio for KBH has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.61 indicates that KBH is not in any danger for bankruptcy at the moment.
KBH has a better Altman-Z score (4.61) than 64.62% of its industry peers.
KBH has a debt to FCF ratio of 6.22. This is a slightly negative value and a sign of low solvency as KBH would need 6.22 years to pay back of all of its debts.
KBH has a Debt to FCF ratio of 6.22. This is comparable to the rest of the industry: KBH outperforms 53.85% of its industry peers.
A Debt/Equity ratio of 0.42 indicates that KBH is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.42, KBH perfoms like the industry average, outperforming 41.54% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.42 | ||
| Debt/FCF | 6.22 | ||
| Altman-Z | 4.61 |
ROIC/WACC1.43
WACC8.42%
2.3 Liquidity
KBH has a Current Ratio of 5.77. This indicates that KBH is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of KBH (5.77) is better than 78.46% of its industry peers.
KBH has a Quick Ratio of 5.77. This is a bad value and indicates that KBH is not financially healthy enough and could expect problems in meeting its short term obligations.
KBH has a worse Quick ratio (0.69) than 64.62% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 5.77 | ||
| Quick Ratio | 0.69 |
3. Growth
3.1 Past
KBH shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 1.83%.
KBH shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 20.25% yearly.
KBH shows a strong growth in Revenue. In the last year, the Revenue has grown by 20.90%.
Measured over the past years, KBH shows a small growth in Revenue. The Revenue has been growing by 7.11% on average per year.
EPS 1Y (TTM)1.83%
EPS 3Y31.02%
EPS 5Y20.25%
EPS Q2Q%13.33%
Revenue 1Y (TTM)20.9%
Revenue growth 3Y15.29%
Revenue growth 5Y7.11%
Sales Q2Q%10.43%
3.2 Future
The Earnings Per Share is expected to grow by 12.80% on average over the next years. This is quite good.
Based on estimates for the next years, KBH will show a small growth in Revenue. The Revenue will grow by 7.21% on average per year.
EPS Next Y20.96%
EPS Next 2Y14.25%
EPS Next 3Y12.8%
EPS Next 5YN/A
Revenue Next Year8.91%
Revenue Next 2Y7.68%
Revenue Next 3Y7.21%
Revenue Next 5YN/A
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 10.18, which indicates a very decent valuation of KBH.
Based on the Price/Earnings ratio, KBH is valued a bit cheaper than the industry average as 76.92% of the companies are valued more expensively.
KBH's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 29.29.
With a Price/Forward Earnings ratio of 8.64, the valuation of KBH can be described as very reasonable.
Based on the Price/Forward Earnings ratio, KBH is valued cheaper than 84.62% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 24.01. KBH is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.18 | ||
| Fwd PE | 8.64 |
4.2 Price Multiples
76.92% of the companies in the same industry are more expensive than KBH, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, KBH is valued a bit cheaper than the industry average as 64.62% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.41 | ||
| EV/EBITDA | 7.6 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
KBH has a very decent profitability rating, which may justify a higher PE ratio.
KBH's earnings are expected to grow with 12.80% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.49
PEG (5Y)0.5
EPS Next 2Y14.25%
EPS Next 3Y12.8%
5. Dividend
5.1 Amount
KBH has a Yearly Dividend Yield of 1.29%. Purely for dividend investing, there may be better candidates out there.
KBH's Dividend Yield is a higher than the industry average which is at 2.79.
Compared to an average S&P500 Dividend Yield of 2.19, KBH's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.29% |
5.2 History
On average, the dividend of KBH grows each year by 47.74%, which is quite nice.
KBH has been paying a dividend for at least 10 years, so it has a reliable track record.
KBH has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)47.74%
Div Incr Years1
Div Non Decr Years10
5.3 Sustainability
KBH pays out 9.20% of its income as dividend. This is a sustainable payout ratio.
The dividend of KBH is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP9.2%
EPS Next 2Y14.25%
EPS Next 3Y12.8%
KB HOME
NYSE:KBH (11/22/2024, 8:04:00 PM)
After market: 79.4 0 (0%)79.4
+1.61 (+2.07%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryHousehold Durables
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap5.82B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.29% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
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Min EPS beat(4)
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EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
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EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.18 | ||
| Fwd PE | 8.64 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)0.49
PEG (5Y)0.5
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.93% | ||
| ROE | 18.75% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 11.17% | ||
| PM (TTM) | 9.26% | ||
| GM | 21.44% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.18
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.42 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 5.77 | ||
| Quick Ratio | 0.69 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)1.83%
EPS 3Y31.02%
EPS 5Y
EPS Q2Q%
EPS Next Y20.96%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)20.9%
Revenue growth 3Y15.29%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y