The 10-second takeaway
For the quarter ended Feb. 28 (Q1), KB Home beat expectations on revenues and exceeded expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly. GAAP loss per share contracted.
Gross margins dropped, operating margins grew, net margins grew.
KB Home booked revenue of $405.2 million. The 12 analysts polled by S&P Capital IQ wanted to see revenue of $351.2 million on the same basis. GAAP reported sales were 59% higher than the prior-year quarter's $254.6 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at -$0.16. The 18 earnings estimates compiled by S&P Capital IQ predicted -$0.22 per share. GAAP EPS were -$0.16 for Q1 compared to -$0.59 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 0.8%, much worse than the prior-year quarter. Operating margin was 0.8%, 970 basis points better than the prior-year quarter. Net margin was -3.1%, much better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $456.0 million. On the bottom line, the average EPS estimate is -$0.08.
Next year's average estimate for revenue is $2.15 billion. The average EPS estimate is $0.18.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 587 members out of 1,257 rating the stock outperform, and 670 members rating it underperform. Among 335 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 166 give KB Home a green thumbs-up, and 169 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 $17.30.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.