NVR, Inc. (NYSE:NVR)
CAPS Rating:
The Company's primary business is the construction and sale of single-family detached homes, townhomes and condominium buildings.
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The Company's primary business is the construction and sale of single-family detached homes, townhomes and condominium buildings.
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NVR's stock price has gotten way ahead of itself. As much as I would like to believe the housing and mortagge crisis is over, that's a major pipe dream.
NVR is a well run company and has a history of significant share buy backs that have very effectively boosted the stock price. At one point, the company had shown some interest in taking the company private to the BENEFIT of shareholders (which rarely happens). At this juncture, there is absolutely no way that will happen.
Insiders have recently been dumping bunches of shares, which definitely has me concerned. In addition, the firm has very heavy exposure to the Metro DC / No Va. market. This regional housing market has not yet seen its bottom. There are still increasing levels of foreclosures and heavy price reductions in the area, even with the introduction of a new governmental administation. All of this is quite negative for NVR. Although I do not believe the company will go out of business, it is highly unlikely they will continue to outperform the broader market in the near term.
They have had a very nice run that is about to come to an abrupt end.