KB Home (KBH) Tops Q2 EPS by 32c, Offers Guidance

(Updated - June 22, 2022 4:12 PM EDT)

KB Home (NYSE: KBH) reported Q2 EPS of $2.32, $0.32 better than the analyst estimate of $2.00. Revenue for the quarter came in at $1.72 billion versus the consensus estimate of $1.61 billion.

Backlog and Net Orders (comparisons on a year-over-year basis)

• Ending backlog value grew 43% to $6.12 billion, the highest second-quarter level in the Company’s history, with each of the Company’s four regions generating increases ranging from 18% in the West Coast to 98% in the Southeast. Ending backlog grew 23% to 12,331 homes.
• Net order value expanded by $87.9 million, or 4%, to $2.12 billion. Net orders of 3,914 decreased 9%, reflecting a moderation in monthly net orders per community to 6.2, compared to 7.0, partly offset by an increase in average community count.
• The Company’s average community count increased 3% to 211, and ending community count increased 7% to 214.
• The cancellation rate as a percentage of gross orders was 17%, compared to 9%.

Guidance:

The Company is providing the following current guidance for its 2022 fiscal year:

• Housing revenues in the range of $7.30 billion to $7.50 billion.
• Average selling price will be approximately $500,000.
• Homebuilding operating income as a percentage of revenues in the range of 16.0% to 16.6%, assuming no inventory-related charges.
• Housing gross profit margin in the range of 25.6% to 26.2%, assuming no inventory-related charges.
• Selling, general and administrative expenses as a percentage of housing revenues in the range of 9.3% to 9.7%.
• Effective tax rate of approximately 25%, assuming no federal energy tax credit extension is enacted.
• Ending community count of approximately 250.
• Return on equity in excess of 27%.

For earnings history and earnings-related data on KB Home (KBH) click here.

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