Home building and mortgage banking company NVR Inc. ( NVR - Snapshot Report ) announced that its board has authorized the repurchase of shares worth $300 million in the open market or in negotiated transactions, subject to market conditions. Earlier in the third quarter, NVR repurchased $220 million worth of shares, thereby rewarding its shareholders. The company has been repurchasing shares since 1994.

NVR operates in two business segments: Homebuilding and Mortgage Banking. The Homebuilding unit sells and builds homes under the trade names like Ryan Homes, NVHomes and Fox Ridge Homes. Recently, the company is focusing on building many new houses and earning profits, as the rising demand for new homes has led to a favorable situation in the housing market. However, inventory levels are dropping and prices are moving up. The company is therefore trying to bring in new products into the market to maintain the required level of inventory to meet the growing demand for homes.

We are positive about the company’s initiatives to constantly introduce new products, which we believe will help it to capitalize on the improving markets. Its peer, KB Home ( KBH - Analyst Report ) recently acquired lands for 100 luxury homes in the sought after community of Playa Vista in Westside, Los Angeles. Another of NVR’s peer, PulteGroup, Inc. ( PHM - Analyst Report ) plans to invest more than $1.0 billion in land development and acquisitions.

Despite improving housing market, NVR Inc. carries a Zacks #4 Rank (short-term ‘Sell’ rating), as we believe that the housing market is still in the recovery stage and the macroeconomic parameters are showing slow growth trajectory.