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NVR, Inc. Message Board

  • flat6guy flat6guy Jul 27, 2007 3:58 PM Flag

    nys observations

    It seems that nys's theory that NVR would go over 1000/sh based on the wall street bullies and the level of the float shorted has been a bit lacking. Check on BZH with over 75% of the float shorted and the pig still drops--ultimately, if the stock is overvalued it will correct in the long run.

    Appears today was anothe---the market givith and taketh away movement--almost eactly the opposite of yesterday, nothing short of crazy. A trader could either make or piss away a fortune with these moves.

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    • volatility is here to stay, until/ unless there is a serious Old Testament bloodbath among hedge funds. too much money controlled by too few adrenaline junkies. the government could always take some kind of action to regulate the most excessive... Ha! Ha! Ha! i crack me up sometimes.

      much as it would please me to see that, the gunslinger mentality is such a part of the american psyche, that i just cant see the hedge fund industry losing too much of its pull. anyway, the choppiness is very much to a value investor's benefit, really.

    • August 23rd is only three weeks away. We should see considerable volatility in the markets between now and end of August.

    • Today will be ugly for NVR............

      2 "good news" stories.....

      and BAD action.....

      look out below

    • I did not say my portfolio is 60% NVR, I said my brokerage account.

      My average basis is $618. It will double by this time next year.

    • yes i agree - the carry trade is unwinding now - just look at the dollar / yen spot prices - also look at the HRB news - not good for the mortgage market - Alt A has just gone sub prime !! yikes.

      i can see at least one big broker announcing issues soon - and a big bank backing out of LBO debt saying they just dont have the balance sheet for it at the moment - if you believe the brokers and this creates a buying opportunity - then when we hit bottom if all of your balance sheet is tied up in junk debt you cant participate in that opportunity.

      Yesterday somebody used the Bank of America NVR upgrade as an exit opportunity - good trading - well done whoever you were - GREEN

    • Yikes! Sure hope that portfolio isn't too big. As I stated on 7/23/07, the unwinding of the yen carry trade is now happening. If it unwinds too fast, we could see a 500-1000 point decline in a single day for the DOW sometime this month. Being long in anything could be painful, especially for equities such as NVR which rely heavily on ETFs and index funds to keep their prices inflated.

    • If you have 60% of your portfolio long on NVR, sell it all at the opening bell tomorrow. We're only in second inning here. There will be not be a meaningful sustained rally. Only buybacks and covering. Shortlived nonsense. Today was a prime example.

    • I remember S.M. from Lennar talking about the "new and improved" home builders years ago.One thing he mentioned was consolidation.To my knowledge that hasn't happened en masse yet.Maybe your scenario would be the beginning of the trend.

    • Perhaps. I sure hope not because after it hit $567 the other day, I now have over 60% of my brokerage account long in NVR (not that it is much money......YET!)

    • Maybe because the 10Q is full of good news and the buyback. Look at the margins this company is still making. If you add back the 67 million impairment (which would have hit COGS) they are at like a 23% margin not 16%! That is after there avg selling price cratered late last year. The margins next quarter will be lower than the 23% I am sure but c'mon these guys are doing a great job managing the downturn.

      They have $571 million in cash plus another 50-60 million coming in Q3. They could fund the buyback and have 300 million left over for working capital without ever touching their line of credit. With only 200 million in term debt, they are in a sweet postition to rule the homebuilding world. In addition, rates have been coming down which if it lasts long enough could help abate some of the mtg crunch.

      Watch them get a buyout offer by year end. My bet is that will be the one to ultimately buy someone. I think a NVR Toll marriage would be ideal. Toll could get out of their mid-level price point stuff (while they don't brag about it, most of their communities around me look like any other ordinary community not upper end) and NVR could shut down its NV brand. In addition, NVR has so much debt capacity it would be a beautiful combination. Plus Saville and Schar are better businessmen than Bobby Toll.

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