Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of homebuilder KB Home (NYSE: KBH) dropped as much as 11% on Tuesday after posting a wider-than-expected quarterly loss.

So what: Hurt by 32% drop in orders and hefty charges, KB's first-quarter loss widened to $1.49 per share, versus the average analyst estimate of just a $0.30 per-share loss. Government tax credits for first-time homebuyers helped boost KB's year-ago orders, but now its focus on that very same demographic, coupled with heavy exposure to the West Coast, seem to be coming back to bite the company.

Now what: I wouldn't be so quick to pounce on today's plunge. Unfortunately, sales and prices of new homes continue to decline at a record pace, so it's tough to see how any homebuilder will be able to turn things around anytime soon -- just last week, rival Lennar (NYSE: LEN) also posted hugely disappointing results. With a few Wall Street analysts now expecting full-year sales decline of as much as 30% for KB, I'd wait for a more encouraging time to place my turnaround bet.

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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Try any of our Foolish newsletter services free for 30 days.

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