Financial Data and Key Metrics Changes - Total revenues for fiscal 2025 exceeded $6.2 billion, with net income of nearly $430 million, resulting in a 10% increase in book value per share [5][6][24] - In Q4 2025, total revenues were just under $1.7 billion, with adjusted diluted earnings per share of $1.92 [7][21] - Housing revenues decreased by 15% in Q4 2025 compared to the previous year, with an average selling price decline of 7% to $466,000 [21][22] Business Line Data and Key Metrics Changes - The company delivered 3,619 homes in Q4 2025, exceeding guidance due to reduced average build times [21] - Housing gross profit margin was reported at 17%, with an adjusted margin of 17.8% after excluding inventory-related charges [22] - The company repurchased 13% of its outstanding shares in 2025, enhancing earnings and book value per share [7][30] Market Data and Key Metrics Changes - The cancellation rate remained stable at 18%, supporting net orders at an average absorption pace of three per month per community [10] - The company experienced a shift towards built-to-order (BTO) homes, with expectations to increase the BTO mix from 57% in Q4 2025 to historical levels of 70% or higher [12][57] Company Strategy and Development Direction - The company aims to enhance its built-to-order sales strategy, which is expected to yield higher margins as the year progresses [20][25] - Plans to open between 35 and 40 new communities in Q1 2026, anticipating a peak community count during the spring selling season [12][29] - The company is focused on maintaining a disciplined approach to pricing, avoiding aggressive sales tactics during slower periods [8][10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the housing market, citing favorable demographics and structural undersupply as key demand drivers [7][8] - The company acknowledged challenges such as low consumer confidence and elevated mortgage rates, which are constraining the pool of actionable buyers [8][10] - Management expects to provide more visibility on operating and gross margins as the spring selling season approaches [9][24] Other Important Information - The company invested $665 million in land acquisition and development in Q4 2025, with a focus on developing owned land [18][29] - The company maintained a strong balance sheet with total liquidity of $1.43 billion at year-end 2025 [29] - A new $1 billion share repurchase authorization was approved to support the capital return strategy [30] Q&A Session Summary Question: Can you help understand the conservatism in the gross margin guide? - Management indicated that some inventory needs to be cleared, impacting margins due to higher costs associated with older specs [32][33] Question: Why exclude accelerated stock compensation from adjusted EPS? - The exclusion was made to provide a like-for-like number for better comparison, as the timing of the equity expense was significant [36][37] Question: What are the finished and under-construction specs at the end of the quarter? - The company reported about 1,700 homes in inventory, with over 1,000 at or near the finished stage [41][42] Question: How is the shift to BTO facilitated by new community openings? - New communities allow for a stronger focus on the built-to-order model without competing with existing specs, enhancing the value proposition [46][54] Question: What is the expectation for the BTO mix in the fiscal first quarter? - The BTO mix is expected to remain in the 57%-60% range for Q1, with a goal to reach at least a 70/30 ratio by the end of the year [58][59] Question: What are the assumptions required for potential impairment charges? - Management stated that a significant shift in community profitability would be needed to trigger larger impairment charges, with current evaluations showing no immediate concerns [68][71]

Financial Data and Key Metrics Changes - Total revenues for fiscal 2025 were over $6.2 billion, with net income of nearly $430 million, resulting in a 10% increase in book value per share [4][24] - In Q4 2025, total revenues were just under $1.7 billion, with adjusted diluted earnings per share of $1.92, and a 15% decrease in housing revenues [5][21] - Housing gross profit margin was 17%, with adjusted housing gross profit margin at 17.8%, reflecting a 310 basis point decrease due to pricing pressure and higher land costs [22] Business Line Data and Key Metrics Changes - The company delivered 12,902 homes in fiscal 2025, with a decrease in housing revenues by 10% to $6.21 billion [24] - In Q4 2025, the company produced 3,619 home deliveries, with an average selling price declining 7% to $466,000 [21] - The cancellation rate was stable at 18%, supporting net orders at an average absorption pace of three per month per community [9] Market Data and Key Metrics Changes - The company owned or controlled approximately 65,000 lots at year-end, with 43% controlled [15] - The average cash down payment for buyers was 17%, equating to nearly $80,000, with an average household income of $130,000 and a FICO score of 743 [14] - The company plans to open between 35 and 40 new communities in Q1 2026, expecting to reach a peak community count during the spring selling season [11] Company Strategy and Development Direction - The company is focused on increasing the built-to-order (BTO) sales mix from 57% in Q4 2025 to historical levels of 70% or higher [12] - A disciplined approach to pricing is emphasized, avoiding inflated prices masked by heavy incentives, which is seen as a competitive advantage [6][7] - The company aims to enhance shareholder value through continued share repurchases and a healthy dividend yield of approximately 1.6% [28][29] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about the housing market, citing favorable demographics and structural undersupply as key demand drivers [5][6] - The company expects Q1 2026 to be the bottom for margins, with improvements anticipated as the year progresses [60] - Management highlighted the importance of maintaining high customer satisfaction and operational execution to drive results [14][18] Other Important Information - The company returned over $600 million in capital to shareholders in fiscal 2025, including approximately $540 million in share repurchases [17][29] - A new $1 billion share repurchase authorization was approved to support the capital return strategy [29] - The company invested $665 million in land acquisition and development in Q4 2025, with a focus on capital efficiency [17][28] Q&A Session Summary Question: Can you help understand the conservatism in the gross margin guide? - Management acknowledged the need to clear older inventory built at higher costs, impacting margins, and emphasized that the guidance is realistic rather than conservative [32][34] Question: Why exclude accelerated stock compensation from adjusted EPS? - The company aimed to provide a like-for-like number for better comparison, given the timing of the equity expense [36][37] Question: What are the finished and under-construction specs at the end of the quarter? - The company reported about 1,700 homes in inventory, with over 1,000 at or near the finished stage [40][41] Question: How does the new community facilitate the shift to BTO? - New communities allow for a stronger focus on BTO sales without competing with existing specs, enhancing the value proposition for customers [46] Question: What is the expectation for pricing in fiscal 2026? - The pricing expectation is driven by a mix of higher-end communities opening, rather than an assumption of price increases [72] Question: How will capital return to shareholders look beyond Q1? - The company plans to maintain a similar capital return strategy of $50 million to $100 million per quarter, evaluating opportunities as the year progresses [75]

Group 1 - The article does not provide any relevant content regarding company or industry insights [1]

Company Overview - KB Home has built approximately 700,000 homes since its founding in 1957[5] - The company operates in 49 major markets across 9 states[8] - KB Home has returned over $1.9 billion to stockholders through repurchases and dividends since Q3 2021[11] Q4 2025 Financial Highlights - Housing revenues totaled $1.68 billion, a decrease of 16% compared to $1.99 billion in Q4 2024[52] - Deliveries decreased by 9% to 3,619 homes, compared to 3,978 homes in Q4 2024[52] - The average selling price decreased by 7% to $465,600, compared to $501,000 in Q4 2024[52] - Net orders decreased by 10% to 2,414, compared to 2,688 in Q4 2024[52] - Backlog value decreased by 37% to $1.40 billion, compared to $2.24 billion in Q4 2024[52] - Book value per share increased 10% to $61.75[52] Capital Allocation and Balance Sheet - The company repurchased approximately 1.6 million shares of its outstanding common stock at a total cost of $100 million during the quarter[52] - Total liquidity was $1.4 billion, including $228.6 million of cash and cash equivalents and nearly $1.2 billion of available capacity under the company's unsecured revolving credit facility[52] - Share repurchases totaled $538 million in 2025[41]

The home builder reported a quarterly profit of $101.5 million as the stagnant housing market continued to eat into its finances. ...

KB Home (KBH) shares gapped down 5.3% in Thursday after-hours trading even after turning in better-than-feared headline results for FQ4 as the homebuilder navigated persistent challenging housing market conditions. The firm sees fiscal-year 2026 deliveries of 11K-12.5K homes (midpoint 11.25K), compared with ...

Financial Performance - Revenues for Q4 2025 totaled $1.69 billion, down from $2.00 billion year-over-year[4] - Net income for Q4 2025 was $101.5 million, compared to $190.6 million in the prior year[4] - Adjusted diluted earnings per share for Q4 2025 was $1.92, down from $2.53 year-over-year[4] - Total revenues for the three months ended November 30, 2025, were $1,694,378, a decrease of 15.3% compared to $1,999,899 in the same period of 2024[18] - Homebuilding revenues for the twelve months ended November 30, 2025, were $6,211,905, down 10% from $6,902,239 in 2024[18] - Operating income for the three months ended November 30, 2025, was $117,098, a decline of 48.9% from $229,099 in the prior year[18] - Net income for the twelve months ended November 30, 2025, was $428,789, down 34.5% from $655,018 in 2024[18] - Adjusted net income for Q4 2025 was $125,710, down 34.2% from $191,217 in Q4 2024[29] - Diluted earnings per share for Q4 2025 were $1.55, compared to $2.52 in Q4 2024[29] Sales and Deliveries - Homes delivered decreased by 9% to 3,619 units in Q4 2025[4] - Total homes delivered in Q4 2025 were 3,619, a decrease of 9.0% from 3,978 in Q4 2024[24] - Net orders for Q4 2025 totaled 2,414, down 10.2% from 2,688 in Q4 2024[24] - Total net order value for Q4 2025 was $1,099,317, a decrease of 16.5% compared to $1,316,653 in Q4 2024[24] - The company plans to deliver between 11,000 to 12,500 homes in 2026[14] Pricing and Margins - Average selling price declined by 7% to $465,600 in Q4 2025[4] - The average selling price for homes in the total market decreased to $465,600 in the three months ended November 30, 2025, from $501,000 in the same period of 2024[22] - Adjusted housing gross profit margin for Q4 2025 was 17.8%, compared to 20.9% in Q4 2024[26] - Total housing gross profits for Q4 2025 were $285,596, down from $415,760 in Q4 2024[26] Liquidity and Capital Management - Total liquidity as of November 30, 2025, was $1.43 billion, including $228.6 million in cash[10] - The company repurchased $100.0 million of common stock in Q4 2025, totaling approximately 9.4 million shares repurchased for the year[10] - Cash and cash equivalents decreased to $228,614 as of November 30, 2025, from $597,973 in 2024, reflecting a decline of 61.8%[20] - Total assets as of November 30, 2025, were $6,680,252, down from $6,936,169 in 2024, indicating a decrease of 3.7%[20] - Total liabilities decreased to $2,779,394 as of November 30, 2025, from $2,875,553 in 2024, a reduction of 3.3%[20] Other Financial Metrics - The effective tax rate for Q1 2026 is projected to be approximately 19.0%[14] - Financial services pretax income for the twelve months ended November 30, 2025, was $34,979, down 28.4% from $48,890 in 2024[18] - The company reported a loss on early extinguishment of debt of $954 for the three months ended November 30, 2025[18] - The company incurred inventory-related charges of $13,700 in Q4 2025, compared to $912 in Q4 2024[29] Backlog - Total backlog as of November 30, 2025, was 3,128 homes valued at $1,403,352, down from 4,434 homes valued at $2,242,907 in the previous year[24]

Market Overview - The S&P 500 is rebounding after four consecutive days of declines, with technology stocks recovering due to strong demand for AI memory chips from Micron, which saw its shares surge over 12% [1] - Consumer discretionary stocks, including major tech companies like Amazon and Tesla, are performing well, alongside gains in restaurants, retail, travel, and leisure sectors, driven by easing inflationary pressures indicated by a cooler-than-expected consumer price index [1] Company Performance - Texas Roadhouse has rallied for two consecutive days, with additional shares purchased at lower levels [1] - Financial stocks have been strong performers, leading to raised price targets for Goldman Sachs ($925 from $850), Wells Fargo ($96 from $90), and Capital One ($270 from $250), although Capital One's rating has been downgraded to a 2 [1] - Capital One shares have increased approximately 20% since comments from New York Fed President John Williams regarding potential interest rate cuts, significantly outperforming the S&P 500's return of about 4% [1] Upcoming Earnings Reports - Nike, FedEx, and KB Home are set to report earnings after the market closes, while Conagra, Lamb Weston, Paychex, and Carnival Corp will report before the market opens on Friday [1] - The University of Michigan's consumer sentiment index and one-year inflation expectations will also be released [1]

KB Home (NYSE:KBH) will release earnings results for its fourth quarter after the closing bell on Thursday, Dec. 18.Analysts expect the Los Angeles, California-based company to report quarterly earnings at $1.79 per share, down from $2.52 per share in the year-ago period. The consensus estimate for KB Home's quarterly revenue is $1.66 billion, compared to $2 billion a year earlier, according to data from Benzinga Pro.On Oct. 27, KB Home announced a new $1 billion share repurchase authorization.KB Home share ...

KB Home (NYSE:KBH) will release earnings results for its fourth quarter after the closing bell on Thursday, Dec. 18.Analysts expect the Los Angeles, California-based company to report quarterly earnings at $1.79 per share, down from $2.52 per share in the year-ago period. The consensus estimate for KB Home's quarterly revenue is $1.66 billion, compared to $2 billion a year earlier, according to data from Benzinga Pro.On Oct. 27, KB Home announced a new $1 billion share repurchase authorization.KB Home share ...