Stockholders' Equity

9 Months Ended

Aug. 31, 2020

A summary of changes in stockholders’ equity is presented below (in thousands):



	Three Months Ended August 31, 2020 and 2019
	Number of Shares
	Common Stock	Grantor Stock Ownership Trust		Treasury Stock		Common Stock		Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss			Grantor Stock Ownership Trust			Treasury Stock			Total Stockholders’ Equity
Balance at May 31, 2020	122,370	(7,317	)	(24,526	)	$	122,370	$	806,700		$	2,255,742		$	(17,149	)	$	(79,359	)	$	(597,950	)	$	2,490,354
Net income	—	—		—		—		—			78,415			—			—			—			78,415
Dividends on common stock	—	—		—		—		—			(8,097		)	—			—			—			(8,097		)
Employee stock options/other	—	—		17		—		(421		)	—			—			—			421			—
Stock-based compensation	—	—		—		—		4,636			—			—			—			—			4,636
Balance at August 31, 2020	122,370	(7,317	)	(24,509	)	$	122,370	$	810,915		$	2,326,060		$	(17,149	)	$	(79,359	)	$	(597,529	)	$	2,565,308

Balance at May 31, 2019	120,350	(7,860	)	(24,264	)	$	120,350	$	775,693		$	1,981,795		$	(9,565	)	$	(85,246	)	$	(587,817	)	$	2,195,210
Net income	—	—		—		—		—			68,136			—			—			—			68,136
Dividends on common stock	—	—		—		—		—			(7,897		)	—			—			—			(7,897		)
Employee stock options/other	173	—		—		173		2,094			—			—			—			—			2,267
Stock-based compensation	—	—		—		—		4,513			—			—			—			—			4,513
Balance at August 31, 2019	120,523	(7,860	)	(24,264	)	$	120,523	$	782,300		$	2,042,034		$	(9,565	)	$	(85,246	)	$	(587,817	)	$	2,262,229

	Nine Months Ended August 31, 2020 and 2019
	Number of Shares
	Common Stock	Grantor Stock Ownership Trust		Treasury Stock		Common Stock		Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss			Grantor Stock Ownership Trust			Treasury Stock			Total Stockholders’ Equity
Balance at November 30, 2019	121,593	(7,631	)	(24,356	)	$	121,593	$	793,954		$	2,157,183		$	(15,506	)	$	(82,758	)	$	(591,344	)	$	2,383,122
Cumulative effect of adoption of ASC 842	—	—		—		—		—			1,510			—			—			—			1,510
Reclassification of stranded tax effects (ASU 2018-02)	—	—		—		—		—			1,643			(1,643		)	—			—			—
Net income	—	—		—		—		—			190,152			—			—			—			190,152
Dividends on common stock	—	—		—		—		—			(24,428		)	—			—			—			(24,428		)
Employee stock options/other	709	—		17		709		7,274			—			—			—			421			8,404
Stock awards	68	314		(15	)	68		(3,080		)	—			—			3,399			(387		)	—
Stock-based compensation	—	—		—		—		12,767			—			—			—			—			12,767
Tax payments associated with stock-based compensation awards	—	—		(155	)	—		—			—			—			—			(6,219		)	(6,219		)
Balance at August 31, 2020	122,370	(7,317	)	(24,509	)	$	122,370	$	810,915		$	2,326,060		$	(17,149	)	$	(79,359	)	$	(597,529	)	$	2,565,308

Balance at November 30, 2018	119,196	(8,157	)	(24,113	)	$	119,196	$	753,570		$	1,897,168		$	(9,565	)	$	(88,472	)	$	(584,397	)	$	2,087,500
Cumulative effect of adoption of ASC 606	—	—		—		—		—			11,610			—			—			—			11,610
Net income	—	—		—		—		—			145,608			—			—			—			145,608
Dividends on common stock	—	—		—		—		—			(12,352		)	—			—			—			(12,352		)
Employee stock options/other	1,271	—		—		1,271		17,458			—			—			—			—			18,729
Stock awards	56	297		(4	)	56		(3,207		)	—			—			3,226			(75		)	—
Stock-based compensation	—	—		—		—		14,479			—			—			—			—			14,479
Tax payments associated with stock-based compensation awards	—	—		(147	)	—		—			—			—			—			(3,345		)	(3,345		)
Balance at August 31, 2019	120,523	(7,860	)	(24,264	)	$	120,523	$	782,300		$	2,042,034		$	(9,565	)	$	(85,246	)	$	(587,817	)	$	2,262,229

On February 20, 2020, the management development and compensation committee of our board of directors approved the payout of 313,246 shares of our common stock in connection with the vesting of PSUs that were granted to certain employees on October 6, 2016. The shares paid out under the PSUs reflected our achievement of certain performance measures that were based on cumulative earnings per share, average return on invested capital, and revenue growth relative to a peer group of high-production public homebuilding companies over the three-year period from December 1, 2016 through November 30, 2019. Of the shares of common stock paid out, 155,307 shares or $6.2 million, were purchased by us in the 2020 first quarter to satisfy the recipients’ withholding taxes on the vesting of the PSUs. The shares purchased were not considered repurchases under the authorizations described below.

As of August 31, 2020, we were authorized to repurchase 2,193,947 shares of our common stock under a board of directors approved share repurchase program. We did not repurchase any of our common stock under this program in the nine months ended August 31, 2020.

Unrelated to the share repurchase program, our board of directors authorized in 2014 the repurchase of not more than 680,000 shares of our outstanding common stock, and also authorized potential future grants of up to 680,000 stock payment awards under the KB Home 2014 Equity Incentive Plan (“2014 Plan”), in each case solely as necessary for director elections in respect of outstanding stock appreciation rights awards granted under our Non-Employee Directors Compensation Plan. The 2014 Plan was amended in April 2016. As of August 31, 2020, we have not repurchased any shares and no stock payment awards have been granted under the 2014 Plan, as amended, pursuant to the respective board of directors’ authorizations.

During each of the three-month periods ended August 31, 2020 and 2019, our board of directors declared, and we paid, quarterly cash dividends on our common stock of $.09 per share. Quarterly cash dividends declared and paid during the nine-month periods ended August 31, 2020 and 2019 totaled $.27 per share and $.14 per share of common stock, respectively. Subsequent to the end of the 2020 third quarter, on October 8, 2020, our board of directors approved an increase in the quarterly cash dividend on our common stock to $.15 per share from $.09 per share, and declared the next quarterly dividend, at the new rate, payable on November 26, 2020 to stockholders of record on November 12, 2020.