KB Home
The 10-second takeaway
For the quarter ended Aug. 31 (Q3), KB Home met expectations on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share expanded.
Gross margins dropped, operating margins dropped, net margins expanded.
Revenue details
KB Home recorded revenue of $424.5 million. The 17 analysts polled by S&P Capital IQ foresaw revenue of $430.1 million on the same basis. GAAP reported sales were 16% higher than the prior-year quarter's $367.3 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS details
EPS came in at -$0.20. The 13 earnings estimates compiled by S&P Capital IQ forecast -$0.15 per share. GAAP EPS were $0.04 for Q3 versus -$0.13 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
Margin details
For the quarter, gross margin was 13.6%, 380 basis points worse than the prior-year quarter. Operating margin was -1.1%, 210 basis points worse than the prior-year quarter. Net margin was 0.8%, 340 basis points better than the prior-year quarter.
Looking ahead
Next quarter's average estimate for revenue is $570.9 million. On the bottom line, the average EPS estimate is $0.06.
Next year's average estimate for revenue is $1.55 billion. The average EPS estimate is -$0.80.
Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 587 members out of 1,253 rating the stock outperform, and 666 members rating it underperform. Among 351 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 151 give KB Home a green thumbs-up, and 200 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on KB Home is hold, with an average price target of $10.43.
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