KB Home (KBH - Free Report) recently announced an amendment to its revolving credit facility, increasing the borrowing capacity to $800 million from $500 million. Also, the maturity for the revolver is extended to October 2023 from July 2021.
Moreover, the borrowing capacity can be increased to $1 billion. This is subject to certain customary conditions.
Earlier in 2017, the company had announced an increase in the credit facility to $500 million from $275 million. Since then, the company witnessed strong execution of the Returns-Focused Growth Plan, and improved revenues, margins, earnings and debt-to-capital ratio.
Specifically, with this move, KB Home expects to enhance the flexibility of its capital structure, which will further allow it to productively deploy excess cash while meeting short-term capital needs.
These efforts boost its maturity profile and help it enjoy greater liquidity for day-to-day operations. Also, the move will boost the company’s existing cash flow. Notably, KB Home has made various strategic efforts like the execution of the Returns-Focused Growth Plan that is designed to drive profitability, return on invested capital, return on equity and leverage ratio.
Notably, on Aug 31, 2019, the company’s debt-to-capital ratio was 45.1%, which improved 460 basis points (bps) from Nov 30, 2018. In fiscal 2018, its return on equity had increased 440 bps to 14.4%. For fiscal 2019, it expects to generate 10-15% return on equity.
Although fiscal third-quarter earnings and revenues declined on a year-over-year basis, the company remains upbeat about improvement in fiscal fourth-quarter results.
Notably, shares of the company have gained 77.8% in the year-to-date period, comparing favorably with its industry’s 48.7% rally. The outperformance was mainly driven by solid execution of the company’s returns-focused growth plan, balanced approach of allocating cash flow, improvement in gross margin and community count growth realization.
Zacks Rank & Other Key Picks
KB Home currently sports a Zacks #1 Rank (Strong Buy). Other top-ranked stocks in the same space include Lennar Corporation (LEN - Free Report) , Taylor Morrison Home Corporation (TMHC - Free Report) and Meritage Homes Corporation (MTH - Free Report) , each sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Lennar, Taylor Morrison and Meritage Homes’ long-term earnings are expected to grow 9%, 8.5% and 5.4%, respectively.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
KB Home (KBH - Free Report) recently announced an amendment to its revolving credit facility, increasing the borrowing capacity to $800 million from $500 million. Also, the maturity for the revolver is extended to October 2023 from July 2021.
Moreover, the borrowing capacity can be increased to $1 billion. This is subject to certain customary conditions.
Earlier in 2017, the company had announced an increase in the credit facility to $500 million from $275 million. Since then, the company witnessed strong execution of the Returns-Focused Growth Plan, and improved revenues, margins, earnings and debt-to-capital ratio.
Specifically, with this move, KB Home expects to enhance the flexibility of its capital structure, which will further allow it to productively deploy excess cash while meeting short-term capital needs.
These efforts boost its maturity profile and help it enjoy greater liquidity for day-to-day operations. Also, the move will boost the company’s existing cash flow. Notably, KB Home has made various strategic efforts like the execution of the Returns-Focused Growth Plan that is designed to drive profitability, return on invested capital, return on equity and leverage ratio.
Notably, on Aug 31, 2019, the company’s debt-to-capital ratio was 45.1%, which improved 460 basis points (bps) from Nov 30, 2018. In fiscal 2018, its return on equity had increased 440 bps to 14.4%. For fiscal 2019, it expects to generate 10-15% return on equity.
Although fiscal third-quarter earnings and revenues declined on a year-over-year basis, the company remains upbeat about improvement in fiscal fourth-quarter results.
Notably, shares of the company have gained 77.8% in the year-to-date period, comparing favorably with its industry’s 48.7% rally. The outperformance was mainly driven by solid execution of the company’s returns-focused growth plan, balanced approach of allocating cash flow, improvement in gross margin and community count growth realization.
Zacks Rank & Other Key Picks
KB Home currently sports a Zacks #1 Rank (Strong Buy). Other top-ranked stocks in the same space include Lennar Corporation (LEN - Free Report) , Taylor Morrison Home Corporation (TMHC - Free Report) and Meritage Homes Corporation (MTH - Free Report) , each sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Lennar, Taylor Morrison and Meritage Homes’ long-term earnings are expected to grow 9%, 8.5% and 5.4%, respectively.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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