KB Home (NYSE: KBH) shares plummeted by over 18% on Thursday after it lowered its guidance for its fourth quarter financial results. Shares plunged into its worst day of trading since 1992.
KB Home’s Chief Executive Officer Jeff Mezger lowered revenue guidance to USD 1.13 Billion to USD 1.34 Billion, lowered from its previous guidance of USD 1.39 Billion to USD 1.45 Billion. Analysts are forecasting revenue of USD 1.43 Billion.
Following KB Home’s announcement, Credit Suisse, Wells Fargo, Barclays and Wedbush all slashed their price targets on the stock. Bank of America Merrill Lynch cut both its rating to neutral from buy and its price target to USD 24 from USD 26 per share, according to CNBC.
Mezger said the lowered guidance was due to “an expected negative impact on our central region deliveries from the historic range experience in Texas, fewer than anticipated spec sales and deliveries, and potential delayed closings over the next couple of weeks in California due to impacts from the recent large wildfires.”
KB Home’s plummet caused other homebuilder stocks to fall as well. Lennar Corp. (NYSE: LEN) fell by 5.2%, Toll Brothers (NYSE: TOL) fell by 6%, Beazer Homes USA (NYSE: BZH) fell by 3.8%.
Street has Q4 EPS at 95 cents which would be alltime high for $KBH
seems crazy beatdown