Before the market open on Thursday, the homebuilder posted earnings of 43 cents per share on $985.78 million in revenue for the quarter ended November 30.
Analysts surveyed by Thomson Reuters had estimated earnings of 50 cents per share on $1.07 billion in revenue for the latest quarter.
Additionally, KB Home stock rating was downgraded to "neutral" from "buy" at MKM Partners. The firm also set a $13 price target on the stock.
"Our 'buy' rating was predicated on the belief that KB Home would improve its execution in 2015 and be rewarded with a higher valuation," MKM said in an analysts note this morning. "Although KB Home did beat earnings in most of 2015, we underestimated the lack of investor confidence in the company and the existence of a valuation floor in the shares."
So far today, 6.89 million shares of KB Home have exchanged hands, compared with its average daily volume of 3.45 million shares.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate KB HOME as a Hold with a ratings score of C+. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, generally higher debt management risk and poor profit margins.