Wall Street analysts appear more optimistic about KB Home's second quarter performance, estimating that losses per share will improve to around ($0.30) from ($1.49) last quarter. The company is scheduled to release its full quarter earnings Wednesday before the market opens, followed by a conference call at 11:30 a.m. Eastern.
M.D.C. Holdings had a first quarter that was nearly exactly what analysts were expecting. During the quarter, management kept the company's per share loss of $0.43, or $19.9 million, relatively flat year over year; worked to grow its topline by increasing its community count by 23% from last year; and reduced its overhead costs by reducing its workforce by 5% during the quarter. However, analysts were still unimpressed by the company's margins, which were at 16% excluding warranty and interest costs, as they threatened to delay the company's return to profitability.
Executives at M.D.C. Holdings are scheduled to release first-quarter results Tuesday before the market opens. Analysts are expecting an average loss of $0.44 per share, which is relatively flat against the company's loss of $0.45 per share a year ago. Topping the company's to-do list during the quarter was further rein in its fixed costs in an effort to better leverage them against volume to the benefit of margins. Analysts would like to see more head count reductions similar to the 100-plus positions that were recently eliminated at Beazer Homes USA. However, for much of the downturn, M.D.C. management has been rather reluctant to keep trimming staff, preferring to run at a significantly higher SG&A level than most peers to keep staff in place for a recovery scenario.
How much better can worse get?
