Deutsche Bank Reiterates Hold, $9 PT on KB Homes

Deutsche Bank maintains its Hold rating and $9 price target on KB Homes

as strong order growth was the only outperformance in F4Q11 results. Deutsche Bank notes, "KB's results outperformed in EPS ($0.18 vs. our $0.07/Street $0.04) and order growth (+38% vs. Street +29%); however, EPS benefited from a $0.26 one-time gain leaving orders as the only area of outperformance. Lower operating margins were the main drag on EPS. Most importantly, cash levels came in slightly below guidance. The risks of ongoing cash concerns are that the company begins to make sub-optimal decisions at the ground level as it prioritizes near-term cash generation over what might be economically best in the long-term." KBH closed at $6.89 on Wednesday.