KB Home (NYSE:KBH) has reported a stellar performance in its fourth quarter of 2024, with earnings and revenue figures that have exceeded Wall Street's expectations. The company announced a revenue of $2 billion for the quarter, marking a 19% increase year-over-year and surpassing the consensus estimate of $1.99 billion. Earnings per share came in at $2.52, beating the analyst consensus of $2.39 by $0.13. This strong financial performance has led to a significant surge in KB Home's stock price, with shares rising 8% to $69.24 on the day of the announcement.

The company's success in the fourth quarter can be attributed to a 17% increase in home deliveries, reaching 3,978 units, and a 3% rise in the average selling price to $501,000. Additionally, KB Home experienced a 41% increase in net orders, totaling 2,688, which indicates robust demand for their homes despite ongoing challenges in the housing market, such as higher mortgage interest rates.

Jeffrey Mezger, Chairman and CEO of KB Home, attributed the company's strong finish to 2024 to faster build times and improved housing market conditions. He emphasized the company's focus on expanding scale, profitability, and returns in 2025, supported by significant investments in land acquisition and development, totaling over $2.8 billion in 2024. KB Home plans to increase these investments further in the coming year.

In terms of shareholder returns, KB Home repurchased $100 million worth of its common stock during the quarter, with $700 million remaining under its buyback program as of November 30, 2024. For the full year, the company returned over $420 million to shareholders through repurchases and dividends.

Looking ahead, KB Home provided guidance for 2025, projecting housing revenues between $7 billion and $7.5 billion, with an average selling price expected to range from $488,000 to $498,000. The company anticipates a homebuilding operating income margin of approximately 10.7% and a housing gross profit margin between 20.0% and 21.0%.

The positive market reaction to KB Home's earnings report reflects investor confidence in the company's ability to navigate the current housing market dynamics and capitalize on the demand for new homes. As KB Home continues to invest in growth and maintain a shareholder-friendly capital allocation strategy, it remains a key player in the U.S. homebuilding industry.