NVR: Land-Light Business Model Will Continue To Provide Significant Upside
Jonathan Koss • Sun, Jun. 29
- NVR's use of land purchase agreements helps it not tie up capital in land and reduces risk if land use is delayed.
- A growing new home market, shown by an 18.6% increase in sales in May, will generate more business for NVR.
- NVR has had a return on invested capital of over 50% for the last 10 years despite the subprime mortgage crisis.
- Low debt and $900 million of share repurchases in the last two years combined with a forward P/E of 14.5 suggest NVR is undervalued.