KB Home Q3 Blowout Lifts Homebuilder ETFs to Highs

Steven Bobson, Europe & Americas Editor
September 23, 2012 /

KB Homes ( KBH ) reported blowout third-quarter results Friday that blasted its stock 17% to a 21-month high and homebuilder ETFs to multiyear highs.

IShares Dow Jones U.S.Home Construction ( ITB ) leapt 2.23% to a four-year high of 20.69. It’s been climbing for seven weeks straight and sports the highest IBD Relative Strength, 96, and Accumulation-Distribution, A, Ratings among all equity ETFs. That shows it’s outpacing the price performance of 96% of the market and institutions are heavily buying shares.

It has to rise 142% to recover its 2006 housing-bubble high. It’s surged 14% so far this month vs. 3.5% for the S&P 500.

SPDR S&P Homebuilders ( XHB ) climbed 1.4% to a five-year high of 26.03. It has to rally 63% to reach its 2006 high.

It sports 93 RS and A- Acc-Dis Ratings. It’s jumped 10% so far this month.

PowerShares Dynamic Building &Construction ( PKB ) rose 1.87% to a four-year high. The weakest among its peers, it carries 88 RS and B+ Acc-Dis Ratings.

KB Home reported for the third quarter:

– Sales climbed 16% from the year-ago period to $424.5 million.

– Deliveries rose 7% year over year to 1,720.

– Average selling price picked up 8% year over year, or $17,700, to $245,100.

– Earnings soared to 4 cents a share vs. a loss of 13 cents a share in Q3 last year.

Last Wednesday, the housing market is rebounding from the housing bubble.


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