KB Home Q4 homebuilding revenue guidance trails consensus after Q3 miss

Sep. 21, 2022 4:39 PM ETKB Home (KBH)By: Liz Kiesche, SA News Editor8 Comments

KB Home Releases 2021 Q4 Earnings

Justin Sullivan

KB Home (NYSE:KBH) stock slipped 1.5% in Wednesday after-hours trading after the homebuilder's fiscal Q3 revenue fell short of the consensus estimate and its guidance for Q4 homebuilding revenue also trailed Wall Street expectations.

"The long-term outlook for the housing market remains favorable," said Chairman, President, and CEO Jeffrey Metzger. "However, the combination of rising mortgage interest rates, ongoing inflation and other macro concerns has caused many prospective buyers to pause on their homebuying decision."

Still, he sees the homebuilder well positioned to navigate the uncertainty with its built-to-order business model and its backlog of more than 10,700 homes.

For fiscal Q4, the company expects housing revenue of $1.95B-$2.05B, less than the Visible Alpha consensus of $2.33B. Average selling price is expected to slip to $503K vs. $508.7K reported in fiscal Q3.

KB Home (KBH) also expects Q4 homebuilding operating income as a percentage of revenue of 16.7%, assuming no inventory-related charges; that's down from 18.1% in Q3.

Q3 EPS of $2.86, topping the $2.67 consensus, increased from $2.32 in Q2 and $1.60 in the year-ago quarter.

Revenue for the quarter ended Aug. 31, 2022 was $1.84B, trailing the $1.90B consensus, climbed from $1.72B in the prior quarter and $1.46B in the year-ago quarter.

Q3 average selling price of $508.7K vs. $494.3K in Q2.

Ending backlog of $5.26B dropped from $6.12B at the end of Q2.

Conference call at 5:00 PM ET.

Earlier, KB Home GAAP EPS of $2.86 beats by $0.19, revenue of $1.84B misses by $60M

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