KB Home said Thursday its third-quarter profit nearly doubled, beating Wall Street estimates, on strong revenue growth and improved margins. The company also raised its earnings outlook for the year.
Net income grew to $227.5 million, or $2.55 a share, in the three months ended Aug. 31, from $117.9 million, or $1.42, a year earlier. Revenue rose 44% to $2.53 billion.
Analysts surveyed by Thomson Financial expected earnings per share of $2.40 on revenue of $2.48 billion.
The third quarter marked the 41st consecutive quarter the company has met or beaten analysts’ expectations, said Bruce Karatz, Los Angeles-based KB Home’s chief executive.
“It was another terrific quarter contributing to a terrific nine months in every aspect, solidifying a very strong financial outlook for the year,” Karatz said. “We are very well positioned, both geographically and financially.”
KB Home raised its earnings outlook for the year to $9.30 a share from $9. Analysts estimate earnings per share of $9.14.
At a midday investor conference in New York, Karatz outlined a three-year growth plan that he said was not predicated on a growing housing market.
“We still have plenty of room to grow,” Karatz said.
He said the company would seek to increase developments of low- and medium-density attached housing.
Net orders for new homes during the quarter were 10,467, a 17% increase over the same period last year, the company said.
KB Home’s order backlog at the close of the third quarter stood at 27,744 homes, valued at about $7.1 billion in revenue, Karatz said.
The company said new-order momentum was strong particularly in central areas of the country such as Texas, Chicago and Indianapolis.
Net housing unit deliveries in the third quarter rose 22% to 9,812, compared with 8,041 in the same quarter last year, the company said.
The company forecast a 25% increase in new-home deliveries for the fourth quarter.
Shares of KB Home rose $2.98 to $73.70.