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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Nvr, Inc. (XNYS:NVR) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
NVR
Name:
NVR, Inc. (XNYS:NVR)
Sector:
305.27M
Industry:
Residential Construction
CEO:
Mr. Paul Saville
Total Employees:
6,600
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -79.05% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF NVR, INC.(NVR) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND RESIDENTIAL CONSTRUCTION INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
4093.13
One Month Price Target:
$4115.89
Six Month Price Target :
$4229.71
Likely Price in One Year's Time:
Ticker:
$4366.29
Likely Trading Range Today Under (Normal Volatility)
$4075.91
Price Upper limit ($) :
$4114.21
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$3863.45
This week:
$3579.54
This month :
$3065.96
Other Primary facts
Market Cap:
13.44B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
3.28M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
21.08%
-20.55%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$5,158.97
$4,670.12
$3,027.29
$3,516.14
Medium risk (<10%) entry points
Buy Call
Sell Call
$4,511.00
Buy Put:
Sell Put:
$4,406.64
$3,673.92
$3,779.62
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
NVR
Sharpe Ratio:
1.39%
Comparison:
NVR, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -44.24% lower than the industry
& is -38.87% lower than the market/S&P 500 average
Average Returns/Yield of
NVR
Daily returns:
0.05%
Weekly returns:
0.24%
Monthly returns:
0.94%
Yearly returns:
23.00%
Comparison of returns:
Average annual returns/yield (last 3 years) is -50.71% below industry average
Classification:
NVR, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.9
Statistical test of Returns:
NVR has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.76%
Weekly Volatility:
6.16%
Monthly Volatility:
12.32%
Yearly Volatility:
42.68%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.42%
Volatility in last five trading days has been -84.64% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.61%
Weekly VaR:
-12.55%
Monthly VaR:
-25.10%
How Much Can the price of
NVR
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-22%
Worst case (decline):
-86.93%
This translates to price declining to:
$3,206.88
This translates to price declining to:
$534.89
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
NVR is a 77.12% riskier investment compared to the market/S&P 500 & is 51.74% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -19.28% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
NVR
Beta in relation to market/S&P 500--0.99
Expected beta in 1 year's time:
0.718
Expected beta in 3 year's time:
1.016
Unlevered (debt free) Beta:
0.686
Beta in relation to Nasdaq (XNAS):
0.878
Beta in relation to all global stocks::
0.855
Beta Comparison & Analysis
Beta of competitors/peers::
1.033
Beta is -3.87% lower than peers
Average Industry Beta:
1.434
Beta is -30.72% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
40.86%
Sustainable growth rate is 45.91% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.014
Alpha is -86.20% below industry average alpha yield
Alpha is 88% compared to market & is healthy
Analysis of Cost of Capital of
NVR
Equity cost of capital:
0.100
Equity cost of capital is -23.26% below industry mean WACC
Unlevered (without debt) cost of capital:
6.88%
Before-tax cost of debt:
3.33%
After-tax cost of debt:
2.63%
Overall debt rating:
High AA grade (second highest grade)
Weighted average cost of capital (WACC):
2.63%
WACC is -31.88% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$2,832.07
Revenue growth rate per share of (3Y):
4.93
Annual revenue growth rate is -2.80% below industry average
EPS:
$374.48
Expected Annual growth rate of EPS (3Y):
9.92%
Expected future EPS growth rate is -47.77% lower than the Residential Construction industry
Free cash flow (FCF) per share:
$341.81
-
-
Debt per share
$484.28
EBITDA per share
$583.66
Valuation Analysis Today of
NVR
P/E Ratio:
9.85
P/E Ratio of Competitors/Peers:
20.36
P/E ratio is -51.65% lower than main peers & is 7.79% higher than the industry
Stock price/value with industry average P/E ratio: $3,420.72
NVR is 19.66% overvalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
1.45
Price to sales ratio is 1.60% above the industry mean
P/B (Price to book value ratio):
4.93
Price to free cash flow: 11.97
Price to free cash flow ratio is -78.48% lower than the industry
Net income growth rate (3Y):
57.30%
Net income growth rate is -36.14% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
58.33%
Net debt to equity ratio:
-20.84%
Debt to assets ratio:
27.76%
Net debt to assets ratio:
-9.92%
Debt-to-asset ratio is -31.22% below industry average
Ability to repay debt:
Interest coverage ratio:
36.23
Interest coverage ratio is -60.90% less than industry average
Looking forward:
Debt growth rate:
0.05%
Annual debt growth is -99% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.02%
Analysis of Key Statistics
Correlation of price movement with the market:
0.643
Statistical significance of correlation:
NVR has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.555
Stock price is 15.88% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.555
Correlation of price movement with Nasdaq (^IXIC):
0.01
Covariance of price movement with the market:
0.016
Kurtosis
14.965
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
0.38
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
NVR
Gross Profit Margin Ratio:
106%
Operating Profit Margin Ratio:
18.65%
Operating profit margin is 37.46% higher than the industry
Net Profit Margin Ratio:
106%
Effective Tax Rate:
23.33%
Effective tax rate is 14.47% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
51.88%
Return on equity (ROE) is 81.74% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
24.69%
Return on assets (ROA) is 66.22% higher than the industry
Financial Leverage:
1.4x
Current Ratio:
4.97
Current ratio is -35.94% below industry average
Cash Conversion Cycle (days):
5.7
Cash conversion cycle is -68.17% below industry average
The remaining useful life of property plant & equipment is: 2.9 years
Stock based compensation to net income ratio:
0.83%
In-depth Efficiency Analysis
Revenue generated per employee:
1.4M
Each employee generates -15% less revenue than industry average revenue per employee
EBITDA generated per employee:
290.3K
Each employee generates -11% less EBITDA than industry average revenue per employee
Profit generated per employee:
214.3K
Each employee generates -14% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
46.3K
Each employee generates -282% less free cash flow than industry average revenue per employee
Assets/Capital per employee
146.9K
Each employee generates -282% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
NVR
LB Group Co., Ltd. (XSHE:002601)
VIPSHOP HOLDINGS LIMITED (XNYS:VIPS)
Amcor plc (XNYS:AMCR)
GENUINE PARTS COMPANY (XNYS:GPC)
MGM RESORTS INTERNATIONAL (XNYS:MGM)
ROLLINS, INC. (XNYS:ROL)
DOMINO'S PIZZA, INC. (XNYS:DPZ)
CARMAX, INC. (XNYS:KMX)
Restaurant Brands International Inc. (XNYS:QSR)
Current Analyst Ratings
Strong buy�8%
Buy�0%
Hold�25%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
9.30B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
6.84B
2.46B
-
572.77M
572.77M
-
- 6312.00K
566.46M
-
52.89M
18.72M
1.92B
1.73B
1.41B
1.84B
430.29M
1.41B
Statement of Cash Flow
Date:
Period:
4.46M
Differed Income Tax :
-
Stock Based Compensation :
11.67M
Change in Working Capital :
- 106236.00K
Accounts Receivables:
-
Other Working Capital:
35.72M
Other Non-Cash Items:
- 26666.00K
Net Cash Provided by Operating Activities:
309.33M
Investments in PP&E:
- 4056.00K
Net Acquisitions:
- 472.00K
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
2.16B
-
2.16B
23.47M
2.19B
381.69M
4.76B
71.70M
-
-
-
-
897.85M
969.55M
-
5.73B
456.61M
-
-
-
501.09M
957.71M
1.59B
-
2.04B
-
3.00B
206.00K
10.47B
-
-
March 31, 2022 at 6:00:00 AM
7.40B
2.73B
5.73B
-
1.59B
- 568132.0K
-
210.00K
- 4318.00K
- 356.00K
-
- 748788.00K
-
34.24M
- 714903.00K
-
- 409895.00K
2.23B
2.64B
309.33M
- 4056.00K
305.27M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
NVR
2023
2024
2025
2026
2027
$4,388.12
$6,227.37
$6,642.96
$7,086.28
$7,559.20