KB Home Shares Jump as Profit Tops Forecasts

Friday, 07 Jan 2011 11:02 AM

 

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink
KB Home posted a quarterly profit without the benefit of tax gains for the first time in almost four years, boosted by higher margins and cost cutting, sending the builder's shares up 5 percent.

Selling, general and administrative expenses fell by more than a third, and earnings easily topped Wall Street expectations.

"The company's better-than-expected gross margin and SG&A represent solid positive surprises and should drive the stock higher today," J.P. Morgan analyst Michael Rehaut wrote in a note to clients.

Net income was $17.4 million, or 23 cents per share, for the fourth quarter, ended Nov. 30. Analysts' average forecast was 17 cents a share, according to Thomson Reuters I/B/E/S.

A year earlier, KB earned $100.7 million, or $1.31 per share, thanks to a change in tax legislation.

Housing gross margins rose to 19.1 percent from 6.8 percent a year earlier, while selling, general and administrative expenses fell by 35 percent to 55.7 million.

Orders were down 25 percent to 1,085, signaling a dip in revenue from home closings in the next few quarters, but that number is roughly in-line with builders' average 26 percent order decline in the third quarter, Rehaut said.

KB shares were up 73 cents to $15.06 in early trading on the New York Stock Exchange.

© 2014 Thomson/Reuters. All rights reserved.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web

Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Country
Zip Code:
Privacy: We never share your email.
 

You May Also Like
Around the Web

Most Commented

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved