KB Home (NYSE:KBH) stock fell 1.14% (As on March 21, 11:47:18 AM UTC-4, Source: Google Finance) after the company reported a robust start to fiscal 2024, with first-quarter earnings and revenue surpassing analyst expectations. The average selling price was $480,100, down from $494,500 in the same quarter last year, while home deliveries increased by 9% to 3,037. KB Home had cash and cash equivalents of $668.1 million as of Feb 29, 2024, down from $727.1 million reported at the end of 2023. The company had a total liquidity of $1.75 billion, including $1.08 billion of available capacity under the unsecured revolving credit facility. Notably, no cash borrowings were outstanding under the revolver on Feb 29, 2024. As of the end of the fiscal first quarter, the debt-to-capital ratio was 30.4%, down from 30.7% at the end of 2023.
KBH in the first quarter of FY 24 has reported the adjusted earnings per share of $1.76, beating the analysts’ estimates for the adjusted earnings per share of $1.56. The company had reported the adjusted revenue growth of 6 percent to $1.47 billion in the first quarter of FY 24, beating the analysts’ estimates for revenue of $1.45 billion.
Moreover, Homebuilding segment’s revenues of $1.46 billion increased 6% from the prior-year quarter’s level. Net orders grew 55% to 3,323 units from the prior year. The value of net orders was up 58% from the year-ago quarter to $1.58 billion, depicting improved demand conditions and a lower cancelation rate compared with the year-ago period. Quarter-end backlog totaled 5,796 homes, down from the year-ago figure of 7,016 units.
Looking ahead, KB Home provided guidance for its 2024 full year with housing revenues expected to be in the range of $6.50 billion to $6.90 billion. The average selling price is projected to range from $480,000 to $490,000. Homebuilding operating income is anticipated to be between 10.9% and 11.3% of revenues, assuming no inventory-related charges. The housing gross profit margin is forecasted to be between 21.0% and 21.4%, with selling, general, and administrative expenses expected to be approximately 10.2% of housing revenues. The effective tax rate is estimated to be around 23.0%, and the ending community count is predicted to be from about 260, up 7% the previous year.
The company also highlighted its commitment to returning capital to shareholders, with $50 million repurchased in common stock and plans for additional repurchases in 2024.