KBH vs DHI

For growth investors, D.

R. Horton, Inc. (DHI) is the stronger pick with -6. 9% revenue growth year-over-year, versus -10. 0% for KB Home (KBH). KB Home (KBH) offers the better valuation at 8. 1x trailing P/E (15. 2x forward), making it the more compelling value choice. Analysts rate KB Home (KBH) a "Hold" — based on 43 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, KB Home (KBH) is the cheapest at 8.

1x versus D. R. Horton, Inc. at 12. 9x. On forward P/E, D. R. Horton, Inc. is actually cheaper at 14. 0x — notably different from the trailing picture, reflecting expected earnings growth. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: KB Home wins at 1. 05x versus D. R. Horton, Inc. 's 1. 12x — a reasonable growth-adjusted valuation.

Over the past 5 years, D.

R. Horton, Inc. (DHI) delivered a total return of +52. 9%, compared to +9. 6% for KB Home (KBH). Over 10 years, the gap is even starker: DHI returned +434. 6% versus KBH's +322. 5%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), D.

R. Horton, Inc. (DHI) is the lower-risk stock at 0. 85β versus KB Home's 1. 00β — meaning KBH is approximately 18% more volatile than DHI relative to the S&P 500. On balance sheet safety, D. R. Horton, Inc. (DHI) carries a lower debt/equity ratio of 24% versus 44% for KB Home — giving it more financial flexibility in a downturn.

By revenue growth (latest reported year), D.

R. Horton, Inc. (DHI) is pulling ahead at -6. 9% versus -10. 0% for KB Home (KBH). On earnings-per-share growth, the picture is similar: D. R. Horton, Inc. grew EPS -19. 3% year-over-year, compared to -27. 2% for KB Home. Over a 3-year CAGR, DHI leads at 0. 8% annualised revenue growth. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.

D.

R. Horton, Inc. (DHI) is the more profitable company, earning 10. 5% net margin versus 6. 9% for KB Home — meaning it keeps 10. 5% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: DHI leads at 12. 9% versus 8. 4% for KBH. At the gross margin level — before operating expenses — DHI leads at 23. 7%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential.

By this metric, KB Home (KBH) is the more undervalued stock at a PEG of 1. 05x versus D. R. Horton, Inc. 's 1. 12x. A PEG below 1. 5 suggests fair-to-attractive pricing relative to expected growth. On forward earnings alone, D. R. Horton, Inc. (DHI) trades at 14. 0x forward P/E versus 15. 2x for KB Home — 1. 2x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for KBH: 26. 0% to $62. 57.

All stocks in this comparison pay dividends.

KB Home (KBH) offers the highest yield at 2. 0%, versus 1. 1% for D. R. Horton, Inc. (DHI).

For long-horizon retirement investors, D.

R. Horton, Inc. (DHI) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0. 85), 1. 1% yield, +434. 6% 10Y return). Both have compounded well over 10 years (DHI: +434. 6%, KBH: +322. 5%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Consumer Cyclical sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both.

These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.