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NVR, Inc. (NVR)

NYSE - NYSE Delayed Price. Currency in USD
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5,064.95-41.19 (-0.81%)
At close: 4:03PM EDT
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  • A
    AbetterDay
    Earnings avg estimate is 72.53 and low estimate is 61 for the quarter ending in June. Last quarter earnings was 63.1 so why is the price falling before the earning report? Any idea?
  • U
    Umba
    If you want to buy a new home, a NVR home is your best value investment.
  • j
    james
    Everything good now in NVR land after earning ??
  • j
    james
    If some of you are not trading NVR on an every few days or weekly basis, you are crazy not to. Yes yes yes, I know a few of you hucksters around here don’t want your precious NVR not to become a house hold name !!! BUT !!! Gotta make da💰 .
  • T
    Tom
    $NVR’s operating performance speaks for itself. This is a flexible and highly efficient enterprise.

    5 Year TTM Normalized (% Change)

    Free-Cash-Flow Per Share +384.5%

    Free-Cash-Flow +352.9%

    Free-Cash-Flow to the Firm +145.3%

    Free-Cash-Flow to Assets +127.5%

    Price to Free-Cash-Flow -62.19%

    Enterprise Value to Free-Cash-Flow -66.19%
  • j
    james
    For all of you who were complaining a couple weeks ago, I hope you added to your position. When we hit $4603.. that was a bargain !!
  • C
    Calibre
    They have one third the revenue of LEN but almost half the earnings. Why is its gain today only half as LEN?
    Maybe I am missing something? Or is it just that retail investors are not buying it as much due to the high ticker price, a split would do?
  • A
    AbetterDay
    What if we have an inflation? Is this dropping because interest rates might go up and less demand for real estate? I am just hoping in the long run I gain some profit because my portfolio is bleeding right now because of this stock.
  • J
    John
    buy X to gain 3 times if home builder stocks go up!
  • T
    Tom
    ~$377M in repurchases. $82 EPS 🔥
  • A
    AbetterDay
    I am so disappointed in this stock. I got in and it dropped.
  • J
    John
    Buy NAIL to get 3X gain from home builders!
  • T
    Tom
    $NVR last 3 years (TTM).

    Financial Debt to EBITDA +61.21%

    Debt to Assets +39.13%

    Debt to Equity +34.02%

    Price to Sales +28.83%

    Enterprise Value to EBITDA +16.72%

    Price to Free-Cash-Flow -29.91%

    Price to Book Value -17.66%

    PE Ratio -2.75%
  • j
    james
    Everyone happy today ?!
  • w
    wbart21
    Housing cyclicality &/or lack of business diversification risk? Wouldn't a truly flawless business have diversification yielding an element of counter cyclicality? Not argumentative ,just trying to pick your brain Tom.
    I do like the company's renewal /extension of SHRP authorization by $300mm esp as PPS is deciding on +/- the key $4000 area. Mgt clearly has faith. My technical focus assists scale up/scale down decisions as I love the idea of buy & forget a great business. For 4 years NVR has been in a big channel roughly between $2100-$4400ish. It's looking more & more likely that it wants to break to upside & make a LT move much higher.
  • T
    Tom
    Greetings. In lieu of my usual speech about retained earnings, let me instead provide you with some relevant statistical information. Take a look at $NVR’s performance over the last 5 years.

    Free-cash-flow +436.4%

    Book Value +137.9%

    Net Income +120.3%

    EBITDA +65.69%

    Profit Margin +56.23%

    Return on Assets +17.05%

    Debt-to-Equity +13.93%

    Shares outstanding -5.62%

    Price to Free-cash-flow -52.09%
  • T
    Tom
    30 year treasuries are yielding ~1.6% compared to ~3.5% in 2018 and ~5% in 2010. “Interest rate risk” as it pertains to home builders is overblown. The short end of the curve is at zero and the long end is essentially zero in real risk-free terms.

    I completely agree with the viewpoint that the vaccine will expedite a sell off on the long end of the curve and drive yields higher. But it’s not so precise; it’s not so precise that a few bps up or down actually affects a buyers disposition towards purchasing.

    Folks, newsflash, there is overwhelming demand for residential real estate. Average homebuyers don’t understand the time value of money or the yield curve. They just want their white picket fence for $500,000 and $NVR is building it for them.
  • T
    Tom
    $NVR really epitomizes my idea of a wonderful business. We’ve got abundant cash flow produced from core operating activities, an asset light model, robust demand for the product, conservative accounting practices (no goodwill) and most importantly, a management team willing to forego dividends, retain earnings and use free cash to repurchase aggressively.

    If you’ve got something that’s making you rich, why do you want to bring in additional partners? Why not keep the money for yourself? This is so fundamental to my investment philosophy.

    Lastly, I love that $NVR is taking on more debt. Why not raise as much capital as possible - makes perfect sense and I would love to see them raise a little more. Folks, that cash is going to straight to repurchases. You can get away with a more top heavy capital structure when you have a proven ability to produce cash flow from operations. It’s different than some other companies, where there’s cash coming in from assets sales. discontinued operations, cash flow from investing activities and other non-core sources. The low variance in $NVR’s operating cash flow helps to support its low WACC, which only further supports the case for borrowing.
  • T
    Tom
    Since my last post, I've adjusted my price target to $5,900 per share. Analysts are too conservative and wrong about $NVR and the influence of the unprecedented action from the Fed. That said, my price target has many assumptions baked in including continued low rates through all of 2021, a Trump re-election and COVID resolution.

    This estimate includes revenues of around ~$8B, net income of ~$1B, around ~$750M spent on repurchases, a float of ~3.4M shares for EPS of around $295 per share next year.

    The company has unbelievably high ROA, ROE, ROIC all from a very balanced capital structure. Operating income and hence operating cash flow is the most important characteristic of any business in my view. It's $NVR's ability to continue to produce strong operating cash flow that enables it to repurchase so much stock and enrich existing shareholders by increasing their proportionate equity.

    I think I mentioned in a previous post that a high ROE really isn't that impressive for businesses with a lot of debt. You see, if a company carries a high amount of debt and has minimal equity, it means those few partners are exposed to a greater amount of risk - but - they can also potentially increase their equity faster, spread amongst fewer partners and therefore potentially generate higher returns on equity but not necessarily on invested capital or total capital which is a better measurement of operating performance.
  • T
    Tom
    This is such a amazing business. I’m not a buyer at this price, and the shares are too hefty to advise going long with a large amount of capital here, but any kind of substantial pullback to say < $3400 which we’ll inevitably get, I think would be a good time to consider opening a position or adding. I bought the shares at ~$2750.