UPDATE: JP Morgan Raises KB Home PT to $21.50 on Gross Margin Outlook

JP Morgan maintained KB Home KBH with an Overweight rating and raised the price target from $20.00 to $21.50. JP Morgan said, "Trading at 1.2x P/B (ex-adjusted FAS 109 charges), a 33% discount to its peers, we believe KBH's valuation does not fully reflect our outlook for the company to generate roughly breakeven EPS in FY13 as well as our outlook for gross margin expansion during the upcoming year, which we note has been a challenge for the company over the last 4 quarters. Thus we rate the stock Overweight relative to its peers." KB Home closed at $17.14 on Monday.