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Why Is NVR (NVR) Up 6.1% Since Last Earnings Report?
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A month has gone by since the last earnings report for NVR (NVR - Free Report) . Shares have added about 6.1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is NVR due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
NVR Q2 Earnings Miss, Homebuilding Revenues Top
NVR reported mixed second-quarter 2024 results, with earnings missing the Zacks Consensus Estimate while Homebuilding revenues surpassed the same. On the other hand, both metrics increased on a year-over-year basis.
The upside was backed by improved demand trends, which resulted in higher settlements. Although the cancellation rate increased during the quarter, growth in new orders and increased average selling price (“ASP”) of new orders are encouraging for the company’s prospects.
Inside the Numbers
The company reported earnings of $120.69 per share, which marginally missed the Zacks Consensus Estimate of $121.65 by 0.8%. The reported figure increased 3.6% from the prior-year quarter’s earnings of $116.54 per share.
Homebuilding revenues of $2.55 billion topped the consensus mark of $2.48 billion by 2.7%. Consolidated revenues (Homebuilding & Mortgage Banking fees combined) amounted to $2.61 billion, up 12% on a year-over-year basis.
Segment Details
Homebuilding: The segment’s revenues of $2.55 billion grew 12% from the year-ago quarter. Settlements in the quarter were up 11% year over year to 5,659 units. The ASP for the settlements was $450,200, flat year over year.
The gross margin contracted 70 basis points year over year to 23.6%.
New orders increased 3% from the prior-year quarter’s levels to 6,067 units. The ASP of new orders increased 3% from the prior-year quarter’s figure to $458,800. The cancellation rate was 12.9%, up from 10.9% a year ago.
On a unit basis, backlog at the end of Jun 30, 2024, improved 3% from the prior-year quarter’s figure to 11,597 homes and rose 6% on a dollar basis to $5.45 billion.
The average active communities were 433 during the quarter, up from 426 reported a year ago.
Mortgage Banking: Mortgage banking fees increased 18.3% year over year to $64.6 million. Mortgage closed loan production totaled $1.53 billion, up 11% year over year. The capture rate was flat year over year at 86%.
Financials
As of Jun 30, 2024, NVR had cash and cash equivalents for Homebuilding and Mortgage Banking of $2.44 billion and $31.1 million compared with $3.13 billion and $36.4 million, respectively, at 2023-end.
During the second quarter, NVR repurchased 83,168 shares for $639 million. At June 2024 end, the company had 3,090,266 shares outstanding.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
VGM Scores
Currently, NVR has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, NVR has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is NVR (NVR) Up 6.1% Since Last Earnings Report?
A month has gone by since the last earnings report for NVR (NVR - Free Report) . Shares have added about 6.1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is NVR due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
NVR Q2 Earnings Miss, Homebuilding Revenues Top
NVR reported mixed second-quarter 2024 results, with earnings missing the Zacks Consensus Estimate while Homebuilding revenues surpassed the same. On the other hand, both metrics increased on a year-over-year basis.
The upside was backed by improved demand trends, which resulted in higher settlements. Although the cancellation rate increased during the quarter, growth in new orders and increased average selling price (“ASP”) of new orders are encouraging for the company’s prospects.
Inside the Numbers
The company reported earnings of $120.69 per share, which marginally missed the Zacks Consensus Estimate of $121.65 by 0.8%. The reported figure increased 3.6% from the prior-year quarter’s earnings of $116.54 per share.
Homebuilding revenues of $2.55 billion topped the consensus mark of $2.48 billion by 2.7%. Consolidated revenues (Homebuilding & Mortgage Banking fees combined) amounted to $2.61 billion, up 12% on a year-over-year basis.
Segment Details
Homebuilding: The segment’s revenues of $2.55 billion grew 12% from the year-ago quarter. Settlements in the quarter were up 11% year over year to 5,659 units. The ASP for the settlements was $450,200, flat year over year.
The gross margin contracted 70 basis points year over year to 23.6%.
New orders increased 3% from the prior-year quarter’s levels to 6,067 units. The ASP of new orders increased 3% from the prior-year quarter’s figure to $458,800. The cancellation rate was 12.9%, up from 10.9% a year ago.
On a unit basis, backlog at the end of Jun 30, 2024, improved 3% from the prior-year quarter’s figure to 11,597 homes and rose 6% on a dollar basis to $5.45 billion.
The average active communities were 433 during the quarter, up from 426 reported a year ago.
Mortgage Banking: Mortgage banking fees increased 18.3% year over year to $64.6 million. Mortgage closed loan production totaled $1.53 billion, up 11% year over year. The capture rate was flat year over year at 86%.
Financials
As of Jun 30, 2024, NVR had cash and cash equivalents for Homebuilding and Mortgage Banking of $2.44 billion and $31.1 million compared with $3.13 billion and $36.4 million, respectively, at 2023-end.
During the second quarter, NVR repurchased 83,168 shares for $639 million. At June 2024 end, the company had 3,090,266 shares outstanding.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
VGM Scores
Currently, NVR has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, NVR has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.