KB Home (KBH) Boosts Single-Family Community Count in Celina
KB Home KBH recently announced the opening of Creeks of Legacy, the builder’s newest community of single-family homes in Celina. The community, which is near to Highway 380 and Dallas North Tollway, will attract homebuyers since the location is appropriate for major employment and retail centers.
KB Home will construct single and double-story homes, with eight distinct floors that will range within 1,800-3,400 square feet in size. The homes at Creeks of Legacy will certainly be desirable. The same will be built per the latest ENERGY STAR guidelines and include WaterSense, which will help homebuyers save within $1,092-$1,500 a year in utility costs.
KB Home’s top priority has been to boost community count for driving revenues. KB Home is a highly consumer-centric company. It focuses on Built-to-Order approach, which provides buyers with a wide range of choices, concerning major aspects of their future home.
Notably, the company’s net orders per community increased 15% in the second quarter to 5.5 per month, marking the highest springs on absorption pace. The company experienced strong absorption rate in the first half of 2018, resulting from faster sell-out rate of communities than KB Home had expected earlier.
Although average community count declined 10% in the second quarter of 2018, the company has plans to boost the same in the second half. Also, KB Home anticipates healthy community count growth in each quarter of 2019, with considerably higher planned openings in the first half of 2019 from the year-ago quarter. This expectation is backed by growth in lot count in the second quarter, with owned and controlled lots up approximately 4500 on a year-over-year basis.
However, shares of this Zacks Rank #4 (Sell) company have declined 10.6% in the past six months compared with the industry’s fall of 15.2%. Higher construction and labor costs, rising interest rate as well as competitive pricing pressure raise concerns.
Stocks to Consider
Some better-ranked stocks in the industry include D.R. Horton, Inc. DHI, PulteGroup, Inc. PHM and Century Communities, Inc. CCS. While D.R. Horton and PulteGroup sport a Zacks Rank #1 (Strong Buy), Century Communities carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
D.R. Horton’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average positive surprise of 8.6%.
PulteGroup delivered an average positive earnings surprise of 14.3% in the trailing four quarters.
Century Communities surpassed earnings estimates in each of the trailing four quarters, resulting in an average positive surprise of 55.3%.
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