| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 85 | 11.8x | 17.8x | Top tier | |
Growth | 7 | -17.5% | 7.1% | Bottom tier | |
Quality | 44 | 4.3% | 4.5% | Around median | |
Safety | 59 | 4.7x | 2.6x | Around median | |
Capital Return | 68 | 2.03% | 2.12% | Top tier | |
Momentum | 25 | -16.7% | 2.9% | Bottom tier | |
Sentiment | 42 | 11 | 3 | Around median |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
KB Home builds and sells homes across multiple U.S. markets and increasingly relies on the build-to-order BTO model, under which the buyer selects the lot, floor plan, and finishes before construction begins. This model creates a backlog of homes sold before foundations are laid and gives the company clearer visibility into price, cost, and delivery timing; KBHS Home Loan also supports the financing process and was used by 83% of buyers who financed their purchases in Q2 fiscal 2026. The company owned or controlled more than 59 thousand lots at the end of that quarter, and its growth markets included Seattle, Boise, and Charlotte, alongside a measured return to Atlanta and the opening of Meridian in Henderson with five product lines.
In Q2 fiscal 2026, ended May 31, 2026, housing revenues were $1.11 billion, down 27% year over year, while net income was $27.3 million and diluted earnings per share were $0.43, compared with $107.9 million and $1.50 in the corresponding period. KB Home delivered approximately 2.4 thousand homes, down 23%, and the average selling price declined 5% year over year to $462 thousand, while the housing gross profit margin was 15.2% compared with 19.3%, and the adjusted margin excluding inventory-related charges was 15.7% compared with 19.7%. Homebuilding operating income reached $28.2 million, with a margin of 2.5%, compared with $131.5 million and a margin of 8.6% a year earlier.
The business mix shifted clearly toward BTO: this model represented 73% of 3.32 thousand net orders and 60% of deliveries in Q2 fiscal 2026, and management is targeting its share to reach approximately 70% of deliveries in Q4 fiscal 2026. Backlog totaled 4.53 thousand homes, up 26% sequentially, and 77% of the 3.99 thousand homes under construction were sold, while completed unsold inventory declined to 11% of total production compared with 25% in Q1 fiscal 2026. EDGAR figures for fiscal 2025 show revenues of $6.2 billion, net income of $428.8 million, and earnings per share of $6.15, while figures for the trailing twelve months ending during fiscal 2026 declined to revenues of $5.5 billion, net income of $272.1 million, and earnings per share of approximately $4.34.
Automated analysis for informational purposes only — not investment advice.
The analyst consensus on KBH is Neutral, with an average price target of $61 and a range between $56 and $66; the average is below the 52-week range high of $68.71 and above its low of $44.03. The data do not provide a published price-to-earnings ratio, but the decline in earnings per share from $6.15 in fiscal 2025 to approximately $4.34 during the latest trailing twelve-month period in fiscal 2026, alongside lower revenues and margins, explains the need to balance the analyst target against the risk of an earnings revaluation. The narrow target range between $56 and $66 and the Neutral consensus also reflect the market’s wait for evidence that the expected improvement in margins and deliveries in the second half of fiscal 2026 will materialize.
Figures in the text are as of 2026-08-31; the live price is shown at the top of the page.
The BTO model allows the buyer to select the lot, floor plan, and finishes before construction begins, giving the home personalized value specific to the buyer. In Q2 fiscal 2026, BTO represented approximately 73% of 3.32 thousand net orders and 60% of deliveries. Management said the gross margin difference between BTO and homes built for inventory is typically approximately four percentage points, even within the same community and product. The company is targeting BTO to reach approximately 70% of deliveries in Q4 fiscal 2026.
Housing revenues declined 27% year over year to $1.11 billion due to a 23% decrease in the number of homes delivered and a 5% decline in the average selling price. The housing gross profit margin also declined to 15.2% from 19.3% due to pricing pressure, the higher relative cost of land, and weaker operating leverage. As a result, net income fell to $27.3 million from $107.9 million, and diluted earnings per share declined to $0.43 from $1.50. The company also recorded inventory-related charges of $5.6 million, including $3.1 million for the impairment of one community.
The company expects to deliver 2.6–2.8 thousand homes and generate housing revenues between $1.2 and $1.35 billion in Q3 fiscal 2026. It expects a housing gross margin between 16.0% and 16.6% before inventory-related charges, compared with an adjusted margin of 15.7% in Q2. For fiscal 2026, it expects to deliver 10.5–11 thousand homes, generate housing revenues between $4.9 and $5.3 billion, and achieve a gross margin between 16.1% and 16.5%. These expectations depend on higher volume, an increased BTO mix, and the contribution of higher-priced, higher-margin Northern California communities.
KBHS Home Loan data for Q2 fiscal 2026 showed an average FICO score of 741 and average household income of approximately $136 thousand. The average cash down payment was 15%, or approximately $70 thousand, and 83% of financed buyers used the KBHS joint venture. Approximately half of customers were buying their first home, while cash buyers represented approximately 8% of deliveries. The cancellation rate remained stable, which management described as a reflection of buyers’ commitment and ability to close.
The company owned or controlled more than 59 thousand lots at the end of Q2 fiscal 2026, with 38% of them controlled rather than directly owned. The number of active communities reached 280, up 11% year over year, after the company opened more than 70 communities during the first half of fiscal 2026. The company opened Meridian in Henderson with five product lines and plans to open Sandstone in North Las Vegas with four lines during fiscal 2026, while its first community in Atlanta is targeted to open in early fiscal 2027. However, management expects the community count to decline to 270–280 at the end of Q3 fiscal 2026 depending on the pace at which existing communities sell out.
KB Home ended Q2 fiscal 2026 with total liquidity of $1.12 billion, including $200 million in cash and $923 million available under an unsecured credit facility, with outstanding cash borrowings of $275 million. The debt-to-capital ratio was 34.1% compared with 30.3% at the end of fiscal 2025, and there are no debt maturities before June 2027. The company repurchased 1.4 million shares for $75 million during the quarter, bringing total repurchases since the beginning of fiscal 2026 to 2.2 million shares for $125 million. It also paid dividends of approximately $15 million and plans to repurchase $50–100 million of shares in Q3 fiscal 2026.
