Shares of KB Home KBH soared 6 percent Thursday after the home builder reported stronger-than-expected results for the first quarter and provided a strong outlook.
The Los Angeles, California-based company posted earnings of $ 0.14 per share, $0.03 ahead of the Street's consensus. Revenue of $678.37 million also came in above expectations for $632.63 million.
KB Home housing revenues grew 28 percent to $672.6 million. Housing gross profit margin advanced to 16 percent.
Meanwhile, deliveries rose 23 percent to 1,953 homes. Average selling price (ASP) increased 5 percent to $344,400.
The company's backlog value advanced 29 percent to $1.43 billion. The cancellation rate as a percentage of beginning backlog improved to 21 percent from 25 percent.
Net orders grew 4 percent to 2,272, and net order value climbed 9 percent to $824.7 million.
Looking ahead, for the second quarter, KB Home expects to generate housing revenues in a range of $710 million to $770 million. In a conference call with analysts, the company maintained its full-year housing revenue forecast of $3.35 billion to $3.65 billion.
For the second quarter of 2016, the company expects ASP to rise 6 percent to approximately $360,000, while full-year ASP is expected to increase between 6 percent and 8 percent from 2015.
The company believes its second quarter gross margin to be relatively flat on a sequential basis, before expanding during the second half of the year. It still expects its full year gross margin to surpass 17 percent.
Shares of KB Home closed Wednesday's regular trading at $13.07. The stock was recently seen up 6 percent at $13.89.
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