NVR (NVR) Down 0.4% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for NVR (NVR). Shares have lost about 0.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is NVR due for a breakout? 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 Q4 Earnings & Revenues Top Estimates, Backlogs Up 40%
NVR, Inc. reported better-than-expected fourth-quarter 2020 results. Earnings not only beat the estimates for the second straight quarter, but also improved year over year. Results benefited from robust demand for new homes on lower mortgage rates and a rising work-from-home trend in the United States.
The company reported earnings of $76.93 per share, which topped the consensus mark of $76.52 by 0.5%. Also, the reported figure grew 19.4% from the prior-year figure of $64.41 per share.
Total revenues (Homebuilding & Mortgage Banking fees combined) amounted to $2.34 billion for the reported quarter. The figure increased 20.4% on a year-over-year basis, backed by robust demand for new homes on lower mortgage rates.
Segment Details
Homebuilding: Revenues in the segment totaled $2.26 billion, up 15.9% from the year-ago level. The metric topped the consensus estimate by 4%. Settlements were up 12% year over year to 6,060 units.
Notably, new orders increased a notable 25% from the prior year to 5,485 units. Average sales price of new orders also inched up 4% from the prior-year quarter to $398,100. Cancellation rate was 12% for the quarter, down from 16% in the year-ago period.
Quarter-end backlog — on a unit and dollar basis — was up 40% and 46% from the year-ago quarter to 11,549 units and $4.57 billion, respectively.
Gross margin came in at 19.5%, flat year over year.
Mortgage Banking: Mortgage banking fees increased 85% year over year to $80.3 million. Moreover, mortgage closed loan production totaled $1.66 billion, up 17% year over year.
Financials
At fourth-quarter end, NVR had cash and cash equivalents for Homebuilding and Mortgage Banking of $2.71 billion and $63.55 million compared with $1.11 billion and $29.4 million, respectively, at 2019-end.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.
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