KB Home (KBH) stock analysis

P/E above its 5-year median

KB Home's P/E of 13.5 is above its own 5-year median of 7.9.

P/E below the industry

KB Home's P/E of 13.5 is below the Operative Builders median of 13.8.

EV/EBITDA against its history

Needs positive EBITDA and price history.

P/B below the industry

KB Home's price-to-book of 0.77 is below the Operative Builders median of 1.00.

Trading below fair value

The share price of $47.90 is below our fair value estimate of $54.44.

Margin of safety under 20%

The price is 12.0% below fair value, less than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew -3.3% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -12.2% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew -56.1% over the last twelve months, against a 5-year average of 7.7% a year.

Growing slower than the industry

Revenue grew -20.8% over the last twelve months; the Operative Builders median is -7.3%.

Guidance lowered

KB Home lowered its 2026 Full Year Housing revenues outlook on Sep 22, 2026.

Gross margin trend

This company does not report gross profit.

Return on equity under 15%

Return on equity was 5.9% over the last twelve months and averaged 17.5% over five years; we look for 15% on both.

Return on invested capital

Needs operating income and invested capital.

Return on equity below the industry

KB Home's return on equity of 5.9% is below the Operative Builders median of 10.7%.

Earnings grew over 5 years

Net income grew 7.7% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 4.4% over the last twelve months, against a 5-year average of 9.4%.

Net margin above the industry

KB Home's net margin of 4.4% is above the Operative Builders median of 4.3%.

No debt

KB Home has no borrowings on its latest balance sheet.

Debt not rising

With no debt today, leverage cannot have risen.

Debt covered by cash flow

There is no debt to cover.

Interest well covered

No meaningful interest expense to cover.

Short-term liquidity

The balance sheet is not split into current and non-current items.

Bankruptcy risk in the grey zone

The Altman Z-score is 1.91; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

KB Home paid dividends worth 1.6% of the share price over the last twelve months.

Yield below Treasuries

The 1.6% yield is below the 4.7% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; KB Home yields 1.6%.

Dividend stability

Fewer than five years of dividend history.

Covered by earnings

Dividends take 27.9% of net income.

Not covered by free cash flow

Dividends take 222% of free cash flow.