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1. Company Snapshot

1.a. Company Description

NVR, Inc.operates as a homebuilder in the United States.The company operates in two segments, Homebuilding and Mortgage Banking.


It engages in the construction and sale of single-family detached homes, townhomes, and condominium buildings under the Ryan Homes, NVHomes, and Heartland Homes names.The company markets its Ryan Homes products to first-time and first-time move-up buyers; and NVHomes and Heartland Homes products to move-up and luxury buyers.It also provides various mortgage related services to its homebuilding customers, as well as brokers title insurance; performs title searches in connection with mortgage loan closings; and sells mortgage loans to investors in the secondary markets on a servicing released basis.


The company primarily serves in Maryland, Virginia, West Virginia, Delaware, New Jersey, Eastern Pennsylvania, New York, Ohio, Western Pennsylvania, Indiana, Illinois, North Carolina, South Carolina, Florida, Tennessee, and Washington, D.C. NVR, Inc.was founded in 1980 and is headquartered in Reston, Virginia.

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1.b. Last Insights on NVR

NVR, Inc.'s recent performance was negatively impacted by declining new orders, which decreased year-over-year. Despite beating Q3 earnings and homebuilding revenue estimates, softer housing demand and margin normalization have affected the company's results. NVR's operating margins have decreased from previous highs, with earnings per share dropping to $112.33 from $130.5 a year ago. The company's share repurchase authorization of up to $750 million, announced in August, is a positive factor. Analysts have revised their estimates downwards, citing unsustainable high margins.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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North Valley Provides Update on B.C. Comstock Copper-Gold Property

Dec -03

Source: feeds.newsfilecorp.com

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BLI Banque de Luxembourg Investments Buys New Shares in NVR, Inc. $NVR

Dec -01

Source: defenseworld.net

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AlphaCore Capital LLC Makes New $162,000 Investment in NVR, Inc. $NVR

Nov -26

Source: defenseworld.net

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NVR Q3 Earnings & Homebuilding Revenues Top, New Orders Down Y/Y

Oct -23

Source: zacks.com

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Sequoia Financial Advisors LLC Boosts Position in NVR, Inc. $NVR

Oct -23

Source: defenseworld.net

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Allspring Global Investments Holdings LLC Has $951,000 Position in NVR, Inc. $NVR

Oct -23

Source: defenseworld.net

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NVR (NVR) Surpasses Q3 Earnings and Revenue Estimates

Oct -22

Source: zacks.com

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NVR, INC. ANNOUNCES THIRD QUARTER RESULTS

Oct -22

Source: prnewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.94%)

6. Segments

Homebuilding Mid Atlantic

Expected Growth: 8.5%

Strong demand in Mid-Atlantic region driven by proximity to Washington D.C., growing job market, and limited land availability, particularly in Maryland and Virginia, will fuel NVR’s growth.

Homebuilding South East

Expected Growth: 5.4%

Growing demand in the southeastern United States, particularly in markets such as Florida and the Carolinas, driven by population growth, job growth, and relatively affordable housing prices.

Homebuilding Mid East

Expected Growth: 5.2%

NVR’s Mid-Atlantic segment benefits from a strong economy, low unemployment, and steady population growth in the Mid-Atlantic region, driven by the presence of major employers, universities, and a high quality of life.

Homebuilding North East

Expected Growth: 7.4%

NVR's strong brand reputation, strategic land acquisition, and increasing demand in the North East region drive expansion. The region's growing economy, low unemployment, and rising household formation are fundamental drivers. Additionally, the company's focus on luxury and move-up homes will continue to fuel growth.

Mortgage Banking

Expected Growth: 7.7%

NVR's growth is driven by increasing demand for new homes, fueled by low interest rates and a shortage of housing supply. The company's focus on single-family homes and strategic expansion into new markets will continue to support its growth momentum.

7. Detailed Products

Single-Family Homes

NVR, Inc. builds and sells single-family homes, offering a range of floor plans and designs to suit various lifestyles and budgets.

Townhomes

NVR, Inc. offers townhomes, which are multi-level homes that provide a sense of community and shared outdoor spaces.

Condominiums

NVR, Inc. develops and sells condominiums, which are ideal for those who want to own their home but don't want to worry about exterior maintenance.

Active Adult Communities

NVR, Inc. builds active adult communities, designed for adults aged 55+, offering a range of amenities and services.

Mortgage Banking

NVR, Inc. offers mortgage banking services, providing financing options for homebuyers.

Title Services

NVR, Inc. provides title services, ensuring a smooth and secure transaction process for homebuyers.

8. NVR, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

NVR, Inc. operates in the homebuilding industry, which has a low threat of substitutes due to the unique nature of its products and services.

Bargaining Power Of Customers

NVR, Inc. has a diverse customer base, which reduces the bargaining power of individual customers. However, the company still needs to be responsive to customer needs and preferences.

Bargaining Power Of Suppliers

NVR, Inc. has a diverse supplier base, which reduces the bargaining power of individual suppliers. The company also has a strong negotiating position due to its large scale of operations.

Threat Of New Entrants

The homebuilding industry has high barriers to entry, including significant capital requirements and regulatory hurdles, which reduces the threat of new entrants.

Intensity Of Rivalry

The homebuilding industry is highly competitive, with many established players competing for market share. NVR, Inc. needs to differentiate itself through its products and services to maintain its market position.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 11.70%
Debt Cost 3.95%
Equity Weight 88.30%
Equity Cost 9.58%
WACC 8.92%
Leverage 13.26%

11. Quality Control: NVR, Inc. passed 9 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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PulteGroup

A-Score: 5.8/10

Value: 5.9

Growth: 8.8

Quality: 7.6

Yield: 2.0

Momentum: 4.0

Volatility: 6.3

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Toll Brothers

A-Score: 5.7/10

Value: 6.8

Growth: 8.1

Quality: 6.7

Yield: 2.0

Momentum: 4.0

Volatility: 6.3

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Lennar

A-Score: 5.4/10

Value: 7.5

Growth: 7.2

Quality: 7.1

Yield: 3.0

Momentum: 1.5

Volatility: 6.3

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D.R. Horton

A-Score: 5.4/10

Value: 5.9

Growth: 7.6

Quality: 6.6

Yield: 2.0

Momentum: 4.0

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
NVR

A-Score: 5.0/10

Value: 4.5

Growth: 7.6

Quality: 7.5

Yield: 0.0

Momentum: 2.0

Volatility: 8.3

1-Year Total Return ->

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KB Home

A-Score: 4.9/10

Value: 6.2

Growth: 7.1

Quality: 5.0

Yield: 3.0

Momentum: 2.5

Volatility: 5.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

7538.08$

Current Price

7538.08$

Potential

-0.00%

Expected Cash-Flows