Shares of KB Home (NYSE:KBH) are up 9.4% as of 3:37 p.m. EDT after the homebuilder reported better-than-expected earnings and calmed investors' fears about the impact of recent hurricanes and an unfortunate situation involving the company's CEO.
KB Home beat analysts' expectations on both the top and bottom lines. Earnings came in at $0.51 per share, $0.05 above expectations, and while the market was looking for revenue of $1.12 billion, the company delivered $1.14 billion. In addition, KB Home delivered 2,765 homes in the quarter, 29 more than expected.
This represents year-over-year increases of 21% on earnings and 23% on revenue.
There was also significant concern about the impacts of the recent hurricanes, as KB Home has large operations in both Texas and Florida, and Hurricane Irma in particular occurred after the end of the company's fiscal third quarter, so there were worries about a potential fourth-quarter hit.
Fortunately, CEO Jeffrey Mezger said that Hurricane Harvey caused minimal damage to the company's homes in Houston, and KB quickly recovered from missed deliveries. In the case of Irma, Mezger said that there was little damage and that KB expects demand to continue to increase.
Finally, Mezger also addressed the elephant in the room at the press conference by apologizing to investors for his infamous incident in which he yelled sexist and homophobic remarks at comedian Kathy Griffin.
The earnings beat combined with relief over the potential hurricane damage clearly pleased investors. It remains to be seen whether KB Home can continue its earnings and revenue growth into 2018, but the company seems to have made it through the worst (hopefully) of hurricane season relatively unscathed.
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