(50 points) Using the data in this table, is your stock a strong buy, buy, hold,
ID: 2793255 • Letter: #
Question
(50 points) Using the data in this table, is your stock a strong buy, buy, hold, sell, or strong sell, relative to the other stocks? Provide an explanation based on the course material.
My stock is KBH
(50 points) Complete the following table, using data obtained from Yahoo Finance over the weekend of November 18-19. Circle the ticker for your stoc. MTH 14.60 12.37 1.43 0.99 90.96 10.91% KBH 21.49 14.08 MDC 14.97 13.03 1.34 0.91 67.93 9.31% 13 .70% MHO Trailing P/E Forward P/E Price/Book (mrq) Enterprise Value/Revenue Total Debt/Equity (mrq) Return on Equity (ttm) Quarterly Revenue Growth (yoy) 10.36 1.08 135.93 7.59% 25.30% 0.84 96.72 9.95% 13 .90% | 0.50%Explanation / Answer
KBH's trailing PE and forward PE are highest among others. I.e. price is greater relative to earnings when compared to peers and hence overvalued.
Price to book ratio is also 1.41 I.e. Price is 1.4 times of the book value.
Enterprise value/ revenue is highest shows that revenues are less compared to others and enterprise value is More, which shows it is overvalued.
Total debt to equity is too high, coMpany uses high leverage and hence high risk.
ROE is lowest among the others.
YOY is the highest which shows increment in revenues but mostly will Be attriButable to debt holders.
Hence the matrix shows it is overvalued, hence suggested to strong sell it.
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