As the housing market slumps, few companies are suffering as badly as KB Home (KBH - Get Report).
The homebuilder specializes in the Southern and Southwestern markets, where the pain is the worst. It recently reported a $172 million quarterly loss from continuing operations, as sales collapsed by a third. And, as we know, the results are similar across the real estate sector and, now, the mortgage business.
KB Home stock has been in free fall for most of the year, plunging roughly 40% since January, trading recently on Wednesday down 2.5% to $31.01.
Cashing out at the top is nothing new for insiders in the hard-hit homebuilder sector, as investors in
(TOL - Get Report)
can attest. Combine the problems in that sector with the recent meltdown of mortgage companies
exposed to subprime loan defaults
and you have a whole lot of pain to go around in the housing industry.
The beating continued for the homebuilders today, as shares of
(BZH - Get Report)
punished on rumors
that the company was filing for bankruptcy. Beazer called the rumors "scurrilous and unfounded." Beazer fell as much as 42% before recovering, and was recently down 14% to $12.01.
Shares of other homebuilders also were sliding Wednesday.
(HOV - Get Report)
was down 9.3%, to $12, Toll Brothers was down 2.3% to $21.43, and
(LEN - Get Report)
slid 2.3% to $29.81.
And what's worse than losing a fortune on these shares? Knowing you bought them at the peak of the market -- possibly from the CEO himself.