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With a market cap of $24.5 billion, NVR, Inc. (NVR) is a leading homebuilder in the United States, specializing in the construction and sale of single-family detached homes, townhomes, and condominium buildings. With a focus on both first-time and move-up buyers, it delivers a range of homes tailored to different market segments. Additionally, NVR provides mortgage-related services and title insurance, ensuring a comprehensive approach to homeownership support. The Reston, Virginia-based company is expected to release its fiscal Q4 earnings results on Tuesday, Feb. 4.
Ahead of this event, analysts project the homebuilder to report a profit of $127.20 per share, reflecting an increase of 4.6% from $121.56 per share in the year-ago quarter. The company holds a track record of surpassing Wall Street's bottom-line estimates in two of the last four quarterly reports while missing on two other occasions. In the most recent quarter, NVR missed the consensus EPS estimate by a 1.2% margin.
For fiscal 2024, analysts forecast NVR to report EPS of $494.48 per share, up 6.7% from $463.31 per share in fiscal 2023.
Over the past 52 weeks, NVR has risen 13.3%, underperforming the broader S&P 500 Index's ($SPX) 24.2% gain. But, the stock has outpaced the SPDR S&P Homebuilders ETF's (XHB) 11% return over the same time frame.
Shares of NVR dipped 2.3% on Oct. 22 due to a miss in earnings expectations, with reported Q3 earnings of $130.50 per share, missing the consensus estimate. Additionally, the higher cancellation rate of 14.5%, up from 13.6% a year ago, raised investor concerns. Although homebuilding revenue exceeded expectations at $2.7 billion, the gross margin contraction of 90 basis points to 23.4% from the previous year also impacted investor sentiment. Furthermore, a decrease in Mortgage Banking fees to $55.3 million added to the downward pressure on shares.
Analysts' consensus view on NVR stock is cautious, with a "Hold" rating overall. Among seven analysts covering the stock, one suggests a "Strong Buy," five give a "Hold," and one recommends a "Strong Sell." As of writing, NVR is trading below the average analyst price target of $9,198.33.
