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This could be why KB Home shorts are so successful

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Written by Reggie Middleton   
Friday, 25 January 2008

Maybe if the CEO's compensation was a little more aligned with the shareholder's compensation, shareholders would be happier and short sellers would be less prevalent. As it stands now, the CEO is getting paid more (much more) than the entire company made for the year. I know what I would be saying if I was a long shareholder... 
 
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
(e) On January 22, 2008, the Management Development and Compensation Committee (the “Compensation Committee”) of KB Home (the “Company”) determined fiscal 2007 bonuses for the Company’s Named Executive Officers, in the amounts set forth below:
             
Named Executive Officer   Title   Fiscal 2007 Bonus
Jeffrey T. Mezger
  President and Chief Executive Officer   $ 6,000,000  

Profitability
Profit Margin (ttm): -14.49%
Operating Margin (ttm): -18.96%
 
Management Effectiveness
Return on Assets (ttm): -10.33%
Return on Equity (ttm): -59.28%
 
Income Statement
   
   
Qtrly Revenue Growth (yoy): -41.60%
Gross Profit (ttm): 2.14B
EBITDA (ttm): -1.20B
Net Income Avl to Common (ttm): -1.41B
Diluted EPS (ttm): -12.04
Qtrly Earnings Growth (yoy): N/A

Stock Price History
Beta: 2.69
52-Week Change3: -54.49%
S&P500 52-Week Change3: -5.04%
52-Week High (02-Feb-07)3: 56.08
52-Week Low (09-Jan-08)3: 15.76


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Inside Job
written by eh, January 28, 2008
A kind of inside job -- he knows KBH isn't going to be making a profit in the foreseeable future, so why not take the cash while it's still there?
62
Inside job or not, he owes the shareholders some money...
written by Reggie Middleton, January 28, 2008
KB Homes does not have any activist shareholders. If they did, this would not be happening. IMO, the CEO owes the shareholders a big refund of his bonus. He actually made more money than the entire company and all the shareholders for the year.

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