Nvr Inc (NYSE: NVR)

Sector: Consumer Cyclical Industry: Residential Construction CIK: 0000906163
Market Cap 21.52 Bn
P/B 5.57
P/E 16.06
P/S 2.13
ROIC (Qtr) 27.76
Div Yield % 0.00
Rev 1y % (Qtr) -5.23
Total Debt (Qtr) 1.05 Bn
Debt/Equity (Qtr) 0.27
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About

NVR, Inc., a prominent Virginia-based corporation, is a leading player in the United States homebuilding industry. The company operates under the well-known trade names Ryan Homes, NVHomes, and Heartland Homes, primarily engaged in the construction and sale of single-family detached homes, townhomes, and condominium buildings. These properties are primarily sold on a pre-sold basis. NVR's mortgage banking operations complement its homebuilding business by providing a range of mortgage-related services to its homebuilding customers. NVR's homebuilding...

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Investment thesis

Bull case

  • Strong operating cash flow of 1.12B provides robust 1.06x coverage of total debt 1.05B, indicating excellent debt servicing capability and financial flexibility.
  • Operating cash flow of 1.12B provides exceptional 38.89x coverage of interest expenses 28.84M, showing strong debt service capability.
  • Operating cash flow of 1.12B provides strong 16.20x coverage of stock compensation 69.21M, indicating sustainable incentive practices.
  • Strong tangible asset base of 5.86B provides 5.56x coverage of total debt 1.05B, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 1.10B exceeds capital expenditure of 23.59M by 46.53x, indicating strong organic growth funding capability.

Bear case

  • Operating cash flow of 1.12B barely covers its investment activities of (71.21M), with a coverage ratio of -15.75, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Cash reserves of 1.96B provide limited coverage of acquisition spending of (47.61M), which is -41.10x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Free cash flow of 1.10B represents just -232.18x of debt issuance (4.73M), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Operating cash flow of 1.12B barely covers operating expenses of (331.14M) with a -3.39 ratio, suggesting thin operational efficiency margins and limited flexibility.
  • Operating cash flow of 1.12B is outpaced by equity issuance of (1.75B) (-0.64 ratio), indicating concerning reliance on equity markets for funding operations.

Segments Breakdown of Revenue (2025)

Peer comparison

Companies in the Residential Construction
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 DHI Horton D R Inc /De/ 56.51 Bn 105.92 7.04 5.55 Bn
2 TOL Toll Brothers, Inc. 29.11 Bn 76.92 7.08 2.79 Bn
3 PHM Pultegroup Inc/Mi/ 28.02 Bn 12.63 1.62 2.16 Bn
4 LEN Lennar Corp /New/ 23.56 Bn -229.13 7.79 4.08 Bn
5 NVR Nvr Inc 21.52 Bn 16.06 2.13 1.05 Bn
6 IBP Installed Building Products, Inc. 8.62 Bn -487.54 19.34 0.99 Bn
7 TMHC Taylor Morrison Home Corp 6.86 Bn 8.06 0.82 2.26 Bn
8 MTH Meritage Homes CORP 5.67 Bn 12.52 0.97 1.83 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 3.50 1.47
EV to Cash from Ops. EV/CFO 18.31 43.01
EV to Debt EV to Debt 19.50 37.82
EV to EBIT EV/EBIT 11.46 48.76
EV to EBITDA EV/EBITDA 11.42 112.58
EV to Free Cash Flow [EV/FCF] EV/FCF 18.70 11.82
EV to Market Cap EV to Market Cap 0.95 1.26
EV to Revenue EV/Rev 2.03 3.28
Price to Book Value [P/B] P/B 5.57 9.23
Price to Earnings [P/E] P/E 16.06 -14.72
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 8.23
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 6.29
Dividend per Basic Share Div per Share (Qtr) 0.00 0.54
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 96.10
Interest Coverage Int. cover (Qtr) 62.10 142.03
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 9.84 27.50
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -26.56 196.58
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 4.02
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -20.09 -29.39
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -16.11 -30.05
EBIT Growth (1y) % EBIT 1y % (Qtr) -16.45 -31.27
EBT Growth (1y) % EBT 1y % (Qtr) -16.71 -32.05
EPS Growth (1y) % EPS 1y % (Qtr) -14.58 -25.62
FCF Growth (1y) % FCF 1y % (Qtr) -18.58 341.90
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -12.33 -14.63
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.72 1.00
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.13
Cash Ratio Cash Ratio 0.00 0.23
Current Ratio Current Ratio 0.00 0.81
Debt to Equity Ratio Debt/Equity (Qtr) 0.27 0.58
Interest Cover Ratio Int Coverage (Qtr) 62.10 142.03
Times Interest Earned Times Interest Earned (Qtr) 62.10 142.03
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 18.00 10.57
EBIT Margin % EBIT Margin % (Qtr) 17.74 9.64
EBT Margin % EBT Margin % (Qtr) 17.45 9.44
Gross Margin % Gross Margin % (Qtr) 21.20 22.26
Net Profit Margin % Net Margin % (Qtr) 13.30 7.17