KB Home (KBH) just released its second quarter earnings. I could not have been more excited, given that the housing market has continued to show weakness over the past few weeks. In addition to that, we just got resultsfrom Lennar (LEN) which showed that investors need more than just positive expectations from homebuilding managers. The good thing is that KB Home reported very strong new orders, solid margins, and positive comments regarding its business model. The stock is way up after earnings but needs more support before I start to bet on a breakout. All things considered, the company confirmed its strength, but more is needed.

11%. That's how much adjusted EPS contracted in the second quarter of 2019. This is the second consecutive quarter of negative EPS growth. That's pretty much where the bad news ends. The first quarter did come in lower compared to the previous-year quarter but managed to easily beat EPS expectations by $0.12. The company has either beaten or met expectations every single quarter over the past years which shows that the company is able to surprise investors in both housing uptrends and downturns.

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