KB Home

Overview Key strengths Key risks Low leverage relative to its history is based on stronger EBITDA. Macroeconomic factors indicate softening U.S. demand for homes. Build-to-order business model allows costs to vary with revenues and thus limits risk. Increasing interest and unemployment rates could reduce buyers? ability or willingness to obtain financing. Company lacks geographic diversification. KB Home (KBH) has maintained leverage below 2x since its fiscal first quarter of 2022 despite an increase in net debt from higher EBITDA. We expect leverage to remain below 2x in 2023 based on its increased EBITDA relative to debt. We expect debt to be about $1.8 billion-$2 billion over the next two years. Mortgage rates increased significantly during fiscal 2022, which affected the

...Strong EBITDA results in lower leverage. KB Home (KBH) has maintained leverage below 2x since its fiscal first quarter of 2022 despite an increase in net debt from higher EBITDA. We expect leverage to remain below 2x in 2023 based on its increased EBITDA relative to debt. We expect debt to be about $1.8 billion-$2 billion over the next two years. Macroeconomics are a mixed bag. Mortgage rates increased significantly during fiscal 2022, which affected the demand for housing during the second half of fiscal 2022, and market conditions and/or government actions could increase rates even further. Any uncertainty and its impact on the overall mortgage market, including the tightening of credit standards, could constrain the ability of...

Full Report