Inflation and Market Sentiment - Investors welcomed a second cool inflation report, easing concerns over higher prices [1] - Positive quarterly earnings from major banks (JPMorgan Chase, Goldman Sachs, Citigroup, Wells Fargo) contributed to the positive market sentiment [1] - The latest jobs report pushed the 10-year treasury yield to a 14-month high near 5%, but cool inflation data is expected to alleviate upward pressure on yields [2] - Light inflation figures may help relieve weakness in rate-sensitive market areas like small-caps, with the Russell 2000 having only 23% of its constituents trading above the 50-day moving average [2] Inflation Data Breakdown - The producer price index (PPI) rose 3.3% year-over-year, up from 3% in November but below the median forecast [4] - Wholesale prices increased 0.2% month-over-month, less than the 0.4% projection [4] - Core PPI (excluding food and energy) rose 3.5% year-over-year, lower than the 3.8% expected, and was virtually unchanged month-over-month [5] - The consumer price index (CPI) showed a 0.4% monthly increase and a 2.9% year-over-year rise, both in line with estimates [7] - Core CPI (excluding food and energy) increased 3.2% year-over-year, slightly better than the 3.3% projection, and rose 0.2% month-over-month, lower than expectations [7] Market Volatility and Stocks - Market volatility (VIX) plunged nearly 9% in early trading Wednesday, potentially offering lower-risk entry points in leading stocks [8] - Homebuilders, particularly the SPDR S&P Homebuilders ETF (XHB), rose more than 4% this week as markets rotated into rate-sensitive areas [9] - KB Home (KBH) reported strong Q4 results, with earnings of $2.52 per share (2.86% above estimates) and revenues of $2 billion, leading to a nearly 5% stock rise [10] Big Banks' Performance - JPMorgan Chase (JPM) delivered Q4 earnings of $4.81 per share, a 19.35% surprise versus estimates, with revenues of $42.77 billion (4.4% above consensus) [11] - JPMorgan shares advanced more than 50% over the past year and were up over 1% in early trading Wednesday [12] - Wells Fargo (WFC), Goldman Sachs (GS), and Citigroup (C) also reported quarterly earnings beats of 5.97%, 48.1%, and 7.2%, respectively [13] - All four banks are part of the Zacks Financials – Investment Bank industry, ranked in the top 5% of Zacks Ranked Industries [16] Industry Insights - Quantitative research shows that roughly half of a stock's price movement can be attributed to its industry group [17] - The top 50% of Zacks Ranked Industries outperforms the bottom 50% by more than 2 to 1, highlighting the importance of targeting leading stocks in top-ranked industries [17]

Dr Duru's Background and Expertise - Dr Duru has been blogging about financial markets since 2000, with experience spanning the dot-com bubble, financial crisis, and COVID-19 pandemic [1] - His blog "One-Twenty Two" provides unique perspectives on financial markets, challenging conventional wisdom and covering stocks, options, currencies, Bitcoin, and more [1] - Dr Duru holds a BS in Mechanical Engineering and an honors degree in Values, Technology, Science and Society from Stanford University, as well as a PhD in Engineering-Economic Systems [1] - His professional experience includes independent consulting in operations research, management consulting in product development, price optimization software development, and business intelligence/data analytics [1] Blog Content and Approach - The blog leverages both technical and fundamental analysis for short-term and long-term trading and investing strategies [1] - Some of Dr Duru's ideas and analyses are featured on Seeking Alpha [1] - The blog aims to provide a different narrative for students and fans of financial markets [1] Consulting Practice - Dr Duru operates a consulting practice focused on analytics, accessible at https://ahan-analytics drduru com/ [1]

Financial Performance - Homes delivered increased 17% to 3,978 units, and the average selling price rose 3% to $501,000 [1] - Homebuilding operating income grew 27% to $229.1 million, and homebuilding operating margin increased by 60 basis points to 11.5% [1] - Fourth-quarter earnings per share (EPS) were $2.52, with revenue up 19% year-over-year to $2 billion, both exceeding analysts' forecasts [4] Market and Demand Trends - New orders climbed by about 40% due to continuing demand and improved market conditions, despite ongoing mortgage interest rate challenges [1] - CEO Jeffrey Mezger noted that homeownership demand continued to grow and market conditions have improved [5] Strategic Investments - The company spent over $2.8 billion in 2024 on land purchases and development, with plans to increase investment again in 2025 [1] Stock Performance - KB Home shares rose over 3% to $66.16 in intraday trading Tuesday and have gained about 10% over the past 12 months [1] - Trading volume for KB Home shares was 2.76 million on Tuesday [2]

Earnings Performance - The company reported earnings of $2.52 per share, beating the consensus estimate of $2.44 per share [1] - The stock surged by 4.17% to $66.75 in early trading following the earnings report [5] Deliveries and Orders - KB Home deliveries grew by 17% year-on-year, exceeding expectations [2] - Orders for the quarter were 2,688, up 41% year-on-year, surpassing the Street's expectations of 32% growth [4] - Management expects orders to be flat year-on-year in Q1 2025, with a decline of 250 orders (3%) anticipated for the full year 2025 [4] Revenue and Margin Guidance - The company guided to housing revenue of $1.45 billion to $1.55 billion for Q1 and $7 billion to $7.5 billion for the full year [3] - Midpoint earnings guidance is $1.58 per share for Q1 and $8.41 per share for the full year [3] - Management's margin guidance for Q1 was better than feared, though risks remain due to assumptions on flat incentives, direct cost reductions, and cycle times [5] Analyst Ratings - Keefe, Bruyette & Woods maintained a Market Perform rating with a price target of $85 [6] - RBC Capital Markets reiterated a Sector Perform rating with a price target of $67 [6] Market Strategy - Management noted higher rates and rate volatility impacting homebuyer demand, leading to the use of incentives to maintain sales pace [2]

KB Home's Fiscal Q4 2024 Performance - KB Home reported strong fiscal Q4 2024 results with both revenues and earnings surpassing expectations, showcasing resilience in a fluctuating housing market [1] - Adjusted EPS of $2.52 beat the Zacks Consensus Estimate by 2.9% and increased 36.2% YoY, while total revenues of $2 billion topped the consensus by 0.4% and grew 19.5% YoY [4] - Shares surged 10.9% in after-market trading, reflecting investor confidence driven by faster build times and a strong order book [2] Homebuilding Segment Performance - Homebuilding revenues grew 19.7% YoY to $1.993 billion, with 3,978 homes delivered, up 17% YoY, exceeding the projected 3,850 units [5] - Average selling price (ASP) increased 3% YoY to $501,000, slightly below the projected $511,600, while build times were reduced by 28% YoY [5] - Net orders surged 41% YoY to 2,688 units, with order value also up 41% to $1.32 billion, though below the projected 3,008 units or $1.51 billion [6] - The cancellation rate improved to 17% of gross orders, down from 28% YoY, and absorption rate increased to 3.5 monthly net orders per community from 2.7 [6] Financial Metrics and Margins - Housing gross margin (excluding inventory-related charges) improved 10 bps YoY to 20.9%, despite challenges like elevated mortgage rates and material costs [8] - SG&A expenses as a percentage of housing revenues decreased 50 bps to 9.4%, reflecting improved operating leverage [9] - Homebuilding operating margin (excluding inventory-related charges) rose 60 bps to 11.5%, exceeding the projected 11.3% [9] Financial Services Segment - Financial services revenues declined 23.8% YoY to $6.85 million, while pretax income increased 7.7% YoY to $13.1 million, driven by higher equity income from the mortgage banking joint venture [10] Fiscal 2024 Highlights - Full-year revenues grew 8.1% YoY to $6.93 billion, with EPS rising over 20% to $8.45 [11] - Homes delivered increased 7% to 14,169, with ASPs up to $486,900 from $481,300 YoY, while adjusted gross margins were 21.1%, down 30 bps [11] Financial Position and Share Repurchases - Cash and cash equivalents stood at $598 million as of Nov. 30, 2024, down from $727.1 million at fiscal 2023-end, with total liquidity of $1.68 billion [12] - Debt-to-capital ratio improved to 29.4% from 30.7% at fiscal 2023-end [12] - The company repurchased 4,725,181 shares for $350 million in fiscal 2024, with $700 million remaining under the repurchase authorization [13] Fiscal 2025 Guidance - Housing revenues are projected to be between $7-$7.50 billion, with ASPs estimated at $488,000-$498,000 [14] - Housing gross margin is expected to be 20%-21%, with operating margin projected at 10.7% and SG&A expenses at 9.6%-10% of housing revenues [14][15] - The effective tax rate is estimated at 24%, with the ending community count expected to be within 250 [15] Industry Comparisons - Lennar Corporation reported weak Q4 2024 results, with earnings and revenues missing estimates and declining YoY due to high mortgage rates and low ASPs [17] - Acuity Brands reported mixed Q1 2025 results, with earnings beating estimates for the 19th consecutive quarter but net sales missing expectations [18] - RPM International reported strong Q2 2025 results, with earnings and sales beating estimates and increasing YoY, driven by record adjusted EBIT and reduced interest expenses [19][20]

Company Performance - KB Home stock increased by 6.1% to $67.98 following a positive forecast for higher housing revenue in 2025 [1] - The company reported Q4 earnings of $2.52 per share on $2 billion revenue, surpassing analyst estimates of $2.45 per share on $1.99 billion [1] - Year-over-year, the stock has risen by 10% [3] Analyst Sentiment - KBH received two price-target cuts and two price-target hikes from analysts [2] - The 12-month consensus price target is $78, representing a 17% premium to current levels [2] - Majority of analysts are bearish, with 13 out of 16 maintaining a "hold" or worse rating [2] Market Activity - KB Home stock has been consolidating around $65 since a pullback in December [3] - The stock broke above its 10- and 20-day moving averages but faces resistance at the 40-day trendline [3] - Options activity surged, with KBH seeing 4.1 times its average daily options volume, particularly at the January 70 call [3]

Financial Data and Key Metrics - The company reported its Q4 2024 earnings and full-year fiscal 2024 results during the conference call [3] Business Line Data and Key Metrics - No specific data or metrics related to individual business lines were mentioned in the provided content [1][2][3][4] Market Data and Key Metrics - No specific data or metrics related to individual markets were mentioned in the provided content [1][2][3][4] Company Strategy and Industry Competition - No specific details on company strategy, development direction, or industry competition were mentioned in the provided content [1][2][3][4] Management Commentary on Operating Environment and Future Outlook - No specific commentary from management on the operating environment or future outlook was mentioned in the provided content [1][2][3][4] Other Important Information - The call included forward-looking statements under the Private Securities Litigation Reform Act of 1995, with the company noting that these statements are not guarantees of future results and that the company does not undertake any obligation to update them [4] Q&A Session Summary - No Q&A session details were provided in the content [1][2][3][4]

Market Performance - Dow gained +358 points, +0.86%, and S&P 500 gained +9 points, +0.16%, while Nasdaq fell -73 points, -0.38% [1] - Russell 2000 small-cap index gained +5 points, +0.24% [1] - Over the past six months, Russell 2000 is up +0.3% and Dow is up +5.2% [2] - 10-year bond yield rose to +4.792% and 2-year bond yield rose to +4.396% [2] Natural Disaster Impact - Property damage estimates from Los Angeles fires increased from $150 billion to $270 billion, potentially the worst natural disaster in U.S. history by property value [3] - Insurers expected to raise prices due to the disaster [3] Company Performance - KB Home (KBH) reported Q4 earnings of $2.52 per share, beating consensus by 7 cents, and quarterly revenues of $2.0 billion, exceeding consensus of $1.99 billion [4] - KB Home's year-over-year revenue growth was +19% [4] - Deliveries increased +17% year-over-year to 3978 units, with Average Selling Price up +3% [5] - KBH shares rose +8% in late trading, offsetting a -3.7% year-to-date decline [5] Economic Indicators - Producer Price Index (PPI) expected to show +0.4% month-over-month headline increase and +0.3% core increase [6] - Year-over-year PPI was +3.0% a month ago, with core at +3.4%, the highest levels in the past 12 months [6] - Beige Book expected to show slight improvements in most regions, with public addresses from Fed Presidents John Williams and Jeffrey Schmid [7]

For the quarter ended November 2024, KB Home (KBH) reported revenue of $2 billion, up 19.5% over the same period last year. EPS came in at $2.52, compared to $1.85 in the year-ago quarter.The reported revenue represents a surprise of +0.39% over the Zacks Consensus Estimate of $1.99 billion. With the consensus EPS estimate being $2.45, the EPS surprise was +2.86%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectatio ...

Exhibit 99.1 FOR RELEASE, Monday, January 13, 2025 For Further Information: 1:10 p.m. Pacific Time Jill Peters, Investor Relations Contact (310) 893-7456 or jpeters@kbhome.com Cara Kane, Media Contact (321) 299-6844 or ckane@kbhome.com LOS ANGELES (January 13, 2025) — KB Home (NYSE: KBH) today reported results for its fourth quarter and year ended November 30, 2024. "We had a strong finish to 2024, with significant year-over-year growth in our fourth-quarter revenues and diluted earnings per share. Our high ...