KB Home (KBH) Price Target Cut is Due to High Rates, Says Jim Cramer

KB Home (NYSE:KBH), similar different homebuilding stocks, has besides suffered successful a high-interest-rate environment. The shares are down by 2.5% implicit the past year, but are up by 9% year-to-date. However, successful December, KB Home (NYSE:KBH)’s shares had dipped by 10% aft the firm’s fiscal 4th fourth earnings. The results saw the firm’s fiscal 2026 gross guidance of $5.10 cardinal to $6.10 cardinal beryllium beneath 2025 gross of $6.21 billion. After the results, Wolfe Research chopped KB Home (NYSE:KBH)’s stock terms people to $56 from $63 and kept an Underperform standing arsenic it pointed retired that the firm’s gross margins could driblet successful its 4th fourth of fiscal twelvemonth 2026. UBS besides chopped the stock terms people to $77 from $83 and kept a Buy standing and lowered its EPS estimates for the coming fiscal years. In this appearance, Cramer discussed UBS’ latest sum of the stock, which saw it chopped the stock terms people to $71 and support a Buy rating:

Mobile homes successful a manufactured location park. Front yard.

“Alright David, you talked astir what punches supra its weight. And that’s housing, arsenic good arsenic Ford stock. Okay, this morning, jeez these probe firms are taking purpose astatine housing. . .And then, UBS. . .KBH, terms people cut. This is simply a sign, again, rates are excessively high, rates are excessively high, and that’s due to the fact that they were truthful low. . .it’s comparative to wherever they were and you can’t bargain starter homes. . . .these cannot get immoderate traction, none. . .”

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Disclosure: None. This nonfiction is primitively published at Insider Monkey.