KB Home's (NYSE:KBH) Results Appear "Clean" Says Ticonderoga

According to Ticonderoga, the impressive results of KB Home (NYSE:KBH) seems to be clean, with gross margins and earnings improving significantly.

Ticonderoga says, "KBH turned in a surprising, and impressive, profit that appears to be clean. A strong, much-improved gross margin combined with an excellent improvement in SG&A—well ahead of even our optimistic expectation—led to a solid EPS number. Last quarter, we said we thought some of the improvements were repeatable, but we did not expect this positive performance. The only thing not to like at first glance is the Orders rate, which disappointed. However, given the rest of the results and the expected community count in 2011, this can be forgiven. The shares should react very well and outperform the group.

Ticonderoga reiterates a "Buy" on KB Home, which closed Friday at $15.25, gaining $0.92, or 6.42 percent. Ticonderoga has a price target of $16 on them.