The target price, we have set in our strategy of the 10th April 2013, has been reach. The stock is now coming back to an opportune entry point to aim a rebound.

The economic and financial situation of the company is still strong. Estimated sales from Thomson Reuters consensus are encouraging. Net income used to be negative in the past years, but is estimated at $25.6 million in 2013, and may skyrocket by almost 300% in 2014.

Technically, the security is in an uptrend on all time scales and it is supported by moving averages. Nonetheless, prices have been stopped by the USD 24.8 short term resistance and are heading towards the USD 22.2 short term support, corresponding to a bullish trend line as well as the 50-day moving average. We expect the stock to use this support as a stepping stone to bounce to USD 24.8.

Thanks to these good indicators, it seems relevant to take a long position in KB Home around USD 22.2. The target price is the USD 24.8 resistance. A stop loss will be fixed under the USD 22.2 short term support because a breakdown of this level would damage technical pattern.