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NVR Gears Up to Report Q1 Earnings: Here's What to Expect

NVR, Inc. NVR is expected to have generated higher earnings and homebuilding revenues in first-quarter 2024 on a year-over-year basis.

In the last reported quarter, earnings topped the Zacks Consensus Estimate by 2.9%, while the homebuilding revenues missed the same by 7.2%. On a year-over-year basis, earnings and homebuilding revenues decreased 9% and 11%, respectively.

The company’s earnings topped analysts’ expectations in 18 of the trailing 23 quarters.

Trend in Estimate Revision

For the quarter to be reported, the Zacks Consensus Estimate for earnings per share (EPS) has increased to $105.91 from $104.76 over the past 30 days. The estimated figure indicates a rise of 6% from the year-ago quarter.

NVR, Inc. Price and EPS Surprise

NVR, Inc. Price and EPS Surprise
NVR, Inc. Price and EPS Surprise

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

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The consensus mark for revenues is pegged at $2.15 billion, suggesting an increase of 0.9% from the year-ago reported figure of $2.13 billion.

Key Factors to Note

NVR’s first-quarter Homebuilding revenues (which accounted for 98.4% of 2023 total revenues) are expected to have increased slightly from the year-ago level on improving demand trends. The upside is mainly backed by the low supply of existing homes, decreased average selling prices that have sparked new order growth rates, and decreasing cancelation rates. Also, a strong business model and a stabilizing economy are likely to have aided the company’s results to some extent.

For the quarter to be reported, our model predicts the average selling price of settlements to decline 1.5% year over year to $452,400. Also, we anticipate total settlements to increase 2.3% to 4,747 units on a year-over-year basis.

Meanwhile, the bottom line of NVR is quite likely to have been affected by material cost inflation and rising wages. We expect the homebuilding gross margin to decline 30 basis points to 24.3% year over year.

Also, we expect selling, general and administrative expenses to increase 4.4% and operating income to decline 1.6% year over year for the homebuilding segment.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for NVR for the quarter to be reported. The company does not have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — 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 currently sports a Zacks Rank #1.

Stocks With the Favorable Combination

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

Willdan Group, Inc. WLDN has an Earnings ESP of +47.37% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

WLDN’s earnings topped the consensus mark in three of the last four quarters and met on one occasion, the average being 886.3%. Earnings for the to-be-reported quarter are expected to decline 40.6% year over year.

Dream Finders Homes, Inc. DFH has an Earnings ESP of +7.14% and a Zacks Rank #1.

DFH’s earnings topped the consensus mark in the last four quarters, the average being 144.9%. Earnings for the to-be-reported quarter are expected to rise 55.6% year over year.

Dycom Industries, Inc. DY has an Earnings ESP of +0.43% and a Zacks Rank #2.

DY’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, the average being 53.9%. Earnings for the to-be-reported quarter are expected to decline 19.7% year over year.

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

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NVR, Inc. (NVR) : Free Stock Analysis Report

Dycom Industries, Inc. (DY) : Free Stock Analysis Report

Willdan Group, Inc. (WLDN) : Free Stock Analysis Report

Dream Finders Homes, Inc. (DFH) : Free Stock Analysis Report

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