KB Home Stock Slides Over 2% Premarket Despite Q4 Beat: What's Going On?
Portfolio Pulse from Shanthi Rexaline
KB Home (NYSE:KBH) saw its stock decline over 2% in premarket trading despite reporting Q4 earnings that beat consensus estimates. The company's revenue decreased by 14% year-over-year to $1.67 billion, but surpassed the expected $1.62 billion. Earnings per share were down from the previous year at $1.85, yet beat the estimate of $1.69. Home deliveries and average selling price also saw declines. The 2024 revenue guidance is in line with expectations, but the Federal Reserve's rate hikes have impacted mortgage rates, affecting home affordability. Analyst Kenneth Zener downgraded KB Home from Buy to Neutral with a price target of $8.55.

January 11, 2024 | 11:30 am
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KB Home reported a Q4 revenue beat and EPS above estimates, but saw a year-over-year decline in revenue, home deliveries, and average selling price. The company's 2024 revenue guidance matches expectations, but analyst Kenneth Zener downgraded the stock to Neutral with a lower price target.
Despite beating Q4 estimates, the year-over-year decline in key financial metrics and the downgrade by Seaport analyst Kenneth Zener are likely to negatively impact investor sentiment in the short term. The premarket stock price decline reflects immediate market reaction to these factors.
CONFIDENCE 90
IMPORTANCE 85
RELEVANCE 100