Persimmon (OTCMKTS:PSMMY) & KB Home (NYSE:KBH) Head to Head Survey

Persimmon (OTCMKTS:PSMMY) and KB Home (NYSE:KBH) are both mid-cap construction companies, but which is the superior investment? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, institutional ownership, earnings, dividends, profitability and risk.

Profitability

This table compares Persimmon and KB Home’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Persimmon	N/A	N/A	N/A
KB Home	8.47%	14.02%	8.14%

Volatility & Risk

Persimmon has a beta of 1.3, meaning that its share price is 30% more volatile than the S&P 500. Comparatively, KB Home has a beta of 1.34, meaning that its share price is 34% more volatile than the S&P 500.

Dividends

Persimmon pays an annual dividend of $2.00 per share and has a dividend yield of 6.5%. KB Home pays an annual dividend of $1.00 per share and has a dividend yield of 1.6%. KB Home pays out 13.2% of its earnings in the form of a dividend. KB Home has increased its dividend for 2 consecutive years.

Earnings and Valuation

This table compares Persimmon and KB Home”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Persimmon	$4.09 billion	1.21	$341.33 million	N/A	N/A
KB Home	$6.93 billion	0.63	$655.02 million	$7.55	8.44

KB Home has higher revenue and earnings than Persimmon.

Insider & Institutional Ownership

96.1% of KB Home shares are owned by institutional investors. 0.6% of Persimmon shares are owned by insiders. Comparatively, 3.9% of KB Home shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Persimmon and KB Home, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Persimmon	0	1	1	2	3.25
KB Home	1	7	3	1	2.33

KB Home has a consensus target price of $66.1364, suggesting a potential upside of 3.74%. Given KB Home’s higher possible upside, analysts plainly believe KB Home is more favorable than Persimmon.

Summary

KB Home beats Persimmon on 11 of the 16 factors compared between the two stocks.

About Persimmon

Persimmon Plc, together with its subsidiaries, operates as a house builder in the United Kingdom. The company offers family housing under the Persimmon Homes brand name; housing under the Charles Church brand name; and social housing under the Westbury Partnerships brand name. It also provides broadband services under the FibreNest brand; and timber frame, insulated wall panels, and roof cassettes under the brand Space4. Further, it offers concrete bricks and roof tile. Persimmon Plc was founded in 1972 and is headquartered in York, the United Kingdom.

About KB Home

KB Home operates as a homebuilding company in the United States. It operates through four segments: West Coast, Southwest, Central, and Southeast. It builds and sells various homes, including attached and detached single-family residential homes, townhomes, and condominiums primarily for first-time, first move-up, second move-up, and active adult homebuyers. The company also provides financial services, such as insurance products and title services, as well as mortgage banking services, including residential consumer mortgage loans to homebuyers. It has operations in Arizona, California, Colorado, Florida, Idaho, Nevada, North Carolina, Texas, and Washington. The company was formerly known as Kaufman and Broad Home Corporation and changed its name to KB Home in January 2001. KB Home was founded in 1957 and is based in Los Angeles, California.