KB Home (KBH)
Profitability ratios
Return on sales
| Nov 30, 2024 | Nov 30, 2023 | Nov 30, 2022 | Nov 30, 2021 | Nov 30, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 98.27% | 98.20% | 98.06% | 98.13% | 19.09% |
| Operating profit margin | 96.53% | 96.39% | 96.13% | 96.26% | 94.57% |
| Pretax margin | 12.26% | 12.03% | 15.54% | 12.16% | 8.70% |
| Net profit margin | 9.43% | 9.21% | 11.84% | 9.87% | 7.08% |
Based on the data provided, the profitability ratios of KB Home have shown positive trends over the past five years.
1. Gross Profit Margin:
- The gross profit margin has significantly improved from 19.09% in November 2020 to 98.27% in November 2024. This indicates that KB Home has been able to increase its revenue while effectively managing its cost of goods sold.
2. Operating Profit Margin:
- The operating profit margin has also shown a consistent increase from 94.57% in November 2020 to 96.53% in November 2024. This indicates that KB Home's operational efficiency has improved, leading to higher profitability from its core business activities.
3. Pretax Margin:
- The pretax margin has fluctuated over the years, with a significant increase in 2022 to 15.54%, but then a decrease to 12.26% in 2024. This could be due to changes in tax expenses or other one-time items impacting profitability.
4. Net Profit Margin:
- The net profit margin has generally increased from 7.08% in November 2020 to 9.43% in November 2024. This indicates that KB Home has been able to maintain solid profitability after accounting for all expenses, including taxes and interest.
Overall, the improving trend of profitability ratios for KB Home suggests that the company has been effectively managing its costs, increasing revenue, and improving operational efficiency, leading to higher profitability over the years. However, fluctuations in the pretax margin in some years may require further investigation to understand the specific factors driving those changes.
Return on investment
| Nov 30, 2024 | Nov 30, 2023 | Nov 30, 2022 | Nov 30, 2021 | Nov 30, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 96.62% | 92.95% | 99.72% | 94.35% | 73.86% |
| Return on assets (ROA) | 9.44% | 8.88% | 12.28% | 9.68% | 5.53% |
| Return on total capital | 165.05% | 162.18% | 181.19% | 182.35% | 148.40% |
| Return on equity (ROE) | 16.13% | 15.49% | 22.31% | 18.70% | 11.11% |
Based on the data provided, let's analyze the profitability ratios of KB Home:
1. Operating Return on Assets (Operating ROA):
- The Operating ROA has shown a positive trend over the years, increasing from 73.86% in November 2020 to 96.62% in November 2024. This indicates that the company has been effective in generating operating income from its assets.
2. Return on Assets (ROA):
- The ROA has also shown an improvement, starting at 5.53% in November 2020 and reaching 9.44% in November 2024. This indicates an increasing ability to generate profits from its total assets.
3. Return on Total Capital:
- The return on total capital has shown a similar positive trend, increasing from 148.40% in November 2020 to 165.05% in November 2024. This shows an efficient use of both equity and debt in generating returns for the company.
4. Return on Equity (ROE):
- The ROE has demonstrated a steady growth, starting at 11.11% in November 2020 and reaching 16.13% in November 2024. This indicates an increasing ability to generate profits for shareholders relative to their equity investment.
In conclusion, KB Home has shown overall improvement in its profitability ratios over the years, reflecting effective management of assets, capital, and equity to generate returns for both the company and its shareholders.