KB Home rates the housing market as ‘robust’ and exceeds expectations for the fourth quarter

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Shares of KB Home rose in Tuesday’s extended session after the builder beat Wall Street expectations for its fourth quarter despite pandemic-related problems in the spring. KB Home KBH, + 1.31% said it earned $ 106 million, or $ 1.12 per share, in the quarter, compared to $ 1.31 per share in the fourth quarter of 2019.

Revenue fell 23% to $ 1.19 billion, reflecting “the negative impact” of the pandemic on the company’s operations, particularly net orders and home construction in the second quarter, the company said. Analysts surveyed by FactSet expected KB Home to report GAAP earnings of 93 cents a share on sales of $ 1.14 billion. The year 2020 was “extraordinary,” with a 42% year-on-year increase in fourth-quarter net orders, Chief Executive Officer Jeffrey Mezger said in a statement. “Housing market conditions continue to be strong as the pandemic has helped drive demand for home ownership” and accelerating trends, he said. KB Home enters 2021 “well positioned to expand our scale and deliver that growth with higher margins,” he said. “Most notably, we expect significantly higher revenue and earnings in 2021 to drive a significant expansion of our return on equity.” KB Home shares have lost 4.8% in the last 12 months, in contrast to gains of around 16% for the S&P 500 Index. SPX, + 0.04%