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What: Shares of homebuilder KB Home
So what: KB's "surprise profit" isn't quite what it sounds like. During the quarter ending in August, the company benefitted to the tune of nearly $30 million from an insurance recovery and a tax benefit. However, the adjusted $0.12-per-share loss was still markedly better than what Wall Street was expecting. The loss was also an improvement on a $0.13 per-share loss last year, and other key metrics were moving in the company's favor -- revenue was up 16%, home deliveries rose 7%, and the average selling price of their homes climbed 8%.
Now what: If you've been following the news lately, you've read plenty about a possible turnaround in the housing market. Sure, we've been hearing about a possible housing-market recovery ever since the housing market collapsed; however, this time around, the numbers seem to actually be confirming the story. If a recovery is indeed underway, this would not only be good news for KB Home and other homebuilders, but for the broader economy, as well.
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Fool contributor Matt Koppenheffer does not have a financial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter @KoppTheFool or Facebook. The Fool’s disclosure policy prefers dividends over a sharp stick in the eye.
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