KBH · sample dossier
KB Home
44/100
OutdatedGenerated Sep 19, 2026 · 10:00 AM UTC · 48 days ago
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EquityKB Home · XNYS
Decision context
Recommendation
Balanced between solid Value (90/100) and constrained Growth (0/100).
A mixed picture — no strong reason to buy or sell right now.
AlphaDog Fair Value
Executive thesis & key metrics
Executive Investment Thesis
KB Home is a homebuilder with a market capitalization of $2.89B and a share price of $47.12, trading at a price-to-book ratio of 0.76 and generating $5.17 in free cash flow per share. The stock's valuation multiple sits at a P/E of 11.81 alongside a Debt/Equity ratio of 0.53, yet top-line contraction is steep with revenue falling -27.3% YoY and EPS contracting -71.3% YoY. The single biggest operational risk is ongoing margin and earnings decay, demonstrated by a weak Piotroski F-score of 4/9 and a trailing 1-year return of -27.5%.
Key Metrics to Watch
What changed recently
No material changes found in the last 30 days.
Why this rating
Score 44 · Hold
Data through
OutdatedMay 31, 2026
Value 90/100 — P/E 11.8x screens cheap vs inputs.
Re-evaluate if
- Net margin falls below 4.0% (was 4.9%)
Trim / reconsider if
- ROA falls below 2.2% (was 3.4%)
- Debt/Equity ratio increases beyond the current 0.53 level.
Think of these dollars as a map of our value estimate for Hold — helpful context, not a reason to override the view.
A Calmer Look · Devil's Advocate
The prevailing consensus treats KB Home as a cyclical 'Hold' anchored by a perceived valuation floor at 0.76 P/B and trailing free cash flow of $5.17 per share.
May be overlooked
Trailing free cash flow of $5.17 per share on a $47.12 stock reflects working capital liquidation and halted land acquisition rather than recurring operational profitability.
Book value protection at 0.76 P/B is vulnerable to balance sheet writedowns across land and housing inventories if gross margins fail to hold at 17.7%.
Notes payable of $1.97B represent 68% of the company's $2.89B market capitalization, presenting refinancing risks that the 0.53 Debt/Equity ratio understates as equity shrinks.
Expectations look stretched
Extrapolating safety from an Altman Z-score of 3.61 ignores that operating income cratered from $131.46M down to $28.15M in the stale May 31, 2026 reporting period.
Treating the P/E of 11.8 as discounted relative to Lennar's 15.1 P/E ignores the 71.3% YoY EPS contraction, which threatens to turn forward multiples significantly more expensive.
Touting CEO Robert V. McGibney's July 2026 purchase of 20,621 shares as positive sentiment disregards the net insider transaction deficit of -$13.08M over the trailing three months.
Revenue growth YoY improves from -27.3% toward positive expansion.
Revenue growth YoY improves from -27.3% toward positive expansion.
Market context
Snapshot returns at report publication
1 month
-16.5%
3 months
-13.1%
6 months
-10.2%
1 year
-27.5%
At a Glance
A mid-sized company is in a pullback at modest pricing.
Top Holders
Financial trajectory
Financial Performance
Go deeper
For learning and research only — not investment advice. AlphaDog doesn’t hold stocks and isn’t your financial advisor.
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