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NVR Q4 Earnings & Revenues to Gain From Solid Housing Demand

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NVR, Inc.’s (NVR - Free Report) fourth-quarter 2021 earnings and revenues are expected to have benefited from solid demand for new homes and a disciplined business model.

In the last reported quarter, the company’s earnings lagged the Zacks Consensus Estimate but increased 33% on a year-over-year basis. Homebuilding revenues topped the consensus estimate by 3.5% and rose 22% from the year-ago level.

It has a strong earnings surprise history, having surpassed analysts’ expectations in 13 of the trailing 15 quarters.

Trend in Estimate Revision

For the quarter to be reported, the Zacks Consensus Estimate for earnings per share has remained stable at $100.34 over the past 60 days. The estimated figure indicates an increase of 30.4% from the year-ago quarter. The consensus mark for revenues is pegged at $2.48 billion, suggesting a 9.6% increase from the year-ago reported figure of $2.26 billion.

NVR, Inc. Price and EPS Surprise

NVR, Inc. Price and EPS Surprise

NVR, Inc. price-eps-surprise | NVR, Inc. Quote

Key Factors to Note

NVR’s quarterly results are likely to be impressive, given the U.S. housing industry’s solid momentum. The company’s fourth-quarter Homebuilding revenues (accounting for 97.4% of total 2020 revenues) are expected to have increased from the year-ago level, backed by robust demand for new homes on lower mortgage rates and the shortage of previously owned houses in the market. Also, the rising trend of working from home owing to the coronavirus outbreak has been boosting demand.

Yet, the overall industry has been grappling with supply chain issues and rising material costs. Intense inflationary pressure and project delays are likely to have ailed NVR’s top-line performance and thereby margins. Although a rise in average home prices nationwide has been affecting affordability, this national homebuilder has been driving growth in orders, thanks to a unique business model. Also, higher demand from diverse demographic groups is likely to have given a boost to orders in the fourth quarter.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for NVR for the quarter to be reported. It doesn’t have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or higher — to increase the odds of an earnings beat.

Earnings ESP: The company has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: NVR carries a Zacks Rank #3.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Stocks With Favorable Combination

Here are some companies in the Zacks Construction sector, which according to our model have the right combination of elements to post an earnings beat in their respective quarters to be reported.

D.R. Horton, Inc.  (DHI - Free Report) has an Earnings ESP of +2.72% and a Zacks Rank #2 (Buy).

DHI’s earnings topped the consensus mark in all the last four quarters, with the average being 14.1%.

PulteGroup, Inc. (PHM - Free Report) has an Earnings ESP of +1.88% and a Zacks Rank #2.

PHM’s earnings topped the consensus mark in three of the last four quarters and missed once, with the average surprise being 3.8%.

Boise Cascade Company (BCC - Free Report) has an Earnings ESP of +9.09% and a Zacks Rank #1.

BCC’s earnings topped the consensus mark in all the last four quarters, with the average being 45.5%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

Free Zacks Research for the Tickers Above

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PulteGroup, Inc. (PHM) - free report >>

D.R. Horton, Inc. (DHI) - free report >>

NVR, Inc. (NVR) - free report >>

Boise Cascade, L.L.C. (BCC) - free report >>