KB Home, a leading homebuilder in the United States, has reported strong financial results for the first quarter of 2024. The company's revenues grew by 6% to reach $1.47 billion, while diluted earnings per share increased by an impressive 21% to $1.76.
In terms of home deliveries, KB Home saw a 9% increase, totaling 3,037 homes. However, the average selling price dipped slightly to $480,100 from the previous period's $494,500. The homebuilding operating income margin also decreased to 10.8% from 11.4%.
On the positive side, the company's net orders surged by 55% to 3,323, with the net order value rising by 58% to $1.58 billion. This spike is attributed to improved demand and a lower cancellation rate compared to the same period last year. Notably, the number of homes in the company’s ending backlog totaled 5,796, a decrease from the previous period, while the ending backlog value was $2.79 billion, down from $3.31 billion.
The company's average community count decreased by 4% to 240, with the ending community count dropping by 7% to 238. However, on a sequential basis, the average community count expanded by 2%.
KB Home's balance sheet as of February 29, 2024, reflected total liquidity of $1.75 billion, including $668.1 million in cash and cash equivalents. The company's inventories increased by 2% to reach $5.24 billion, and its total investments in land and land development surged by 60% from the year-earlier quarter to $587.1 million.
Moreover, KB Home repurchased 826,663 shares of its outstanding common stock in the first quarter at a total cost of $50.0 million. As of February 29, 2024, the company had $113.6 million remaining under its current common stock repurchase authorization, and its book value per share grew by 14% year over year to $51.14.
Looking ahead, the company provided guidance for its 2024 full year, including anticipated housing revenues in the range of $6.50 billion to $6.90 billion and an average selling price in the range of $480,000 to $490,000. The effective tax rate is expected to be approximately 23.0%, with an ending community count of about 260, reflecting a 7% increase year over year.
The market has reacted to these announcements by moving the company's shares 2.4% to a price of $69.89. For the full picture, make sure to review KB Home's 8-K report.