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Here's Why You Should Add NVR Stock to Your Portfolio Now
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The housing market has lately been catching eye in Wall Street, thanks to the resilient job growth and gradual economic recovery. One such company cashing in on the favorable backdrop is NVR, Inc. (NVR - Free Report) . The company is engaged in the construction and sale of single-family detached homes, townhomes and condominium buildings.
Also, homebuilding industry finds a place in the top 8% of the Zacks Industry Rank. A good industry rank supports growth. In fact, on a year-to-date basis, the Zacks classified Building-Residential/Commercial industry has widely outperformed the broader market (S&P 500), as you can see below.
Let us delve deeper into the other factors which makes this Zacks Rank #2 (Buy) stock a lucrative pick.
Stock Price Movement: Shares of NVR have rallied 44.5% year to date, outpacing the Building-Residential/Commercial industry’s gain of 26.5%. The stock has performed well compared with the broader market (S&P 500) that climbed 10.4% in the said period. While any stock can see a spike in price, it takes a real winner to consistently outperform the market. We noticed that NVR also outperformed the industry in some of the other time frames we considered too – 4-week, 12-week and 52-week.
Earnings & Revenue Growth: Possibly, nothing is more important than earnings growth.
On this front, NVR has put up a historical (3–5 year) EPS growth rate of 30.1% compared with the industry average of 18.9%. Moreover, the stock also has a long-term (3–5 years) expected EPS growth rate of 14%, higher than the industry average of 11.9%.
The company’s 2017 earnings is expected to grow 24.8%, while the Zacks categorized Building Residential/Commercial industry’s earnings are likely to increase 17.3%.
Meanwhile, the company’s sales are also expected to increase 10.6% in the current year compared with the industry average growth of 17.3%. Hence, NVR makes for a great pick in terms of Growth investment.
Estimate Revisions: In the last 90 days, the Zacks Consensus Estimate for NVR’s EPS moved north by $1.29–$129.34 for 2017. The positive earnings estimate revisions suggest that analysts are getting a shade more bullish on the company’s prospects.
Return on Equity: NVR’s trailing 12-month return on equity (ROE) supports its growth potential. ROE in the trailing 12 months is 34.5%, while the industry gained 11.2%, reflecting the company’s efficient usage of shareholders’ funds.
Again, a stock with beta less than 1 suggests that the price movement of the stock is not highly correlated with the market. Since they are less volatile than the market, they are safer bets at the moment. NVR has an impressive beta of 0.66. Adding it to your portfolio brings down your portfolio’s overall beta, thereby reducing its risk.
VGM Score: Taylor Morrison has a VGM Score of 'B'. Our VGM Score identifies stocks that have the most attractive value, growth, and momentum characteristics. In fact, our research shows that stocks with VGM Scores of 'A' or 'B' when combined with a Zacks Rank #1 (Strong Buy) or 2 make solid investment choices.
Other Stocks to Consider
You can consider a few other top-ranked stocks in the same space.
PulteGroup, Inc. (PHM - Free Report) carries a Zacks Rank #2. Its earnings are expected to grow 32.1% this year.
M.D.C. Holdings, Inc. also carries a Zacks Rank #2. Its earnings are expected to increase 27.9% this year.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation. See Them Free>>
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Here's Why You Should Add NVR Stock to Your Portfolio Now
The housing market has lately been catching eye in Wall Street, thanks to the resilient job growth and gradual economic recovery. One such company cashing in on the favorable backdrop is NVR, Inc. (NVR - Free Report) . The company is engaged in the construction and sale of single-family detached homes, townhomes and condominium buildings.
Also, homebuilding industry finds a place in the top 8% of the Zacks Industry Rank. A good industry rank supports growth. In fact, on a year-to-date basis, the Zacks classified Building-Residential/Commercial industry has widely outperformed the broader market (S&P 500), as you can see below.
Let us delve deeper into the other factors which makes this Zacks Rank #2 (Buy) stock a lucrative pick.
Stock Price Movement: Shares of NVR have rallied 44.5% year to date, outpacing the Building-Residential/Commercial industry’s gain of 26.5%. The stock has performed well compared with the broader market (S&P 500) that climbed 10.4% in the said period. While any stock can see a spike in price, it takes a real winner to consistently outperform the market. We noticed that NVR also outperformed the industry in some of the other time frames we considered too – 4-week, 12-week and 52-week.
Earnings & Revenue Growth: Possibly, nothing is more important than earnings growth.
On this front, NVR has put up a historical (3–5 year) EPS growth rate of 30.1% compared with the industry average of 18.9%. Moreover, the stock also has a long-term (3–5 years) expected EPS growth rate of 14%, higher than the industry average of 11.9%.
The company’s 2017 earnings is expected to grow 24.8%, while the Zacks categorized Building Residential/Commercial industry’s earnings are likely to increase 17.3%.
Meanwhile, the company’s sales are also expected to increase 10.6% in the current year compared with the industry average growth of 17.3%. Hence, NVR makes for a great pick in terms of Growth investment.
Estimate Revisions: In the last 90 days, the Zacks Consensus Estimate for NVR’s EPS moved north by $1.29–$129.34 for 2017. The positive earnings estimate revisions suggest that analysts are getting a shade more bullish on the company’s prospects.
Return on Equity: NVR’s trailing 12-month return on equity (ROE) supports its growth potential. ROE in the trailing 12 months is 34.5%, while the industry gained 11.2%, reflecting the company’s efficient usage of shareholders’ funds.
Again, a stock with beta less than 1 suggests that the price movement of the stock is not highly correlated with the market. Since they are less volatile than the market, they are safer bets at the moment. NVR has an impressive beta of 0.66. Adding it to your portfolio brings down your portfolio’s overall beta, thereby reducing its risk.
VGM Score: Taylor Morrison has a VGM Score of 'B'. Our VGM Score identifies stocks that have the most attractive value, growth, and momentum characteristics. In fact, our research shows that stocks with VGM Scores of 'A' or 'B' when combined with a Zacks Rank #1 (Strong Buy) or 2 make solid investment choices.
Other Stocks to Consider
You can consider a few other top-ranked stocks in the same space.
KB Home (KBH - Free Report) sports a Zack Rank #1. Its earnings are expected to grow 51.1% in fiscal 2017. You can see the complete list of today’s Zacks #1 Rank stocks here.
PulteGroup, Inc. (PHM - Free Report) carries a Zacks Rank #2. Its earnings are expected to grow 32.1% this year.
M.D.C. Holdings, Inc. also carries a Zacks Rank #2. Its earnings are expected to increase 27.9% this year.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation. See Them Free>>