KB Home (KBH - commentary - Cramer's Take) is scheduled to report results for the fourth quarter and fiscal 2008 (for the period ended Nov. 30, 2008) before the market opens Friday; the company will conduct its quarterly conference call at midday. Analysts expect KBH to lose $1.24 a share on revenue of $793 million.
I would note the wide range of EPS estimates -- analysts are looking for a per-share loss of anything from 20 cents to $3.70. In other words, the "consensus" estimate is not very reliable given what is likely a large standard deviation in estimates. In the prior year's quarter, KB Home lost $9.99 a share; in the sequential quarter, the company posted a $1.87-a-share deficit.
The last major homebuilder earnings I covered was for Toll Brothers (TOL - commentary - Cramer's Take), in what is now the infamous "ferschlug" conference call. In that call, it became apparent that the headwinds for the housing markets have subsided and tailwinds have begun to form. This call took place a month ago. Since then, the Treasury and Fed have injected more liquidity into the banking system, mortgage rates have fallen and mortgage applications have risen. I will be more focused on how those macro conditions are affecting KB Home and the industry rather than the actual micro, backward-looking results from KBH.
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homebuilders TOL Preview: Too Early to Call a Bottom? 12/3/2008 2:28 PM EST The company is expected to post a loss of 47 cents per share on $681.36 million in revenue.
At the time of publication, Rothbort had no positions in the stocks mentioned, although positions can change at any time.
Scott Rothbort has over 20 years of experience in the financial services industry. In 2002, Rothbort founded LakeView Asset Management, LLC, a registered investment advisor based in Millburn, N.J., which offers customized individually managed separate accounts, including proprietary long/short strategies to its high net worth clientele. He also is the founder and manager of the social networking educational Web site TheFinanceProfessor.com.
Immediately prior to that, Rothbort worked at Merrill Lynch for 10 years, where he was instrumental in building the global equity derivative business and managed the global equity swap business from its inception. Rothbort previously held international assignments in Tokyo, Hong Kong and London while working for Morgan Stanley and County NatWest Securities.
Rothbort holds an MBA in finance and international business from the Stern School of Business of New York University and a BS in economics and accounting from the Wharton School of Business of the University of Pennsylvania. He is a Term Professor of Finance and the Chief Market Strategist for the Stillman School of Business of Seton Hall University.
For more information about Scott Rothbort and LakeView Asset Management, LLC, visit the company's Web site at www.lakeviewasset.com. Scott appreciates your feedback; click here to send him an email.
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