Backlog and Home Prices - As of December 31, 2025, the backlog totaled 8,448 units valued at approximately $4.0 billion, down from 9,953 units valued at approximately $4.8 billion as of December 31, 2024[20] - The average price of homes in backlog decreased to $474,400 as of December 31, 2025, from $481,400 as of December 31, 2024[20] - The average price of homes settled was $460,600 in 2025, compared to $450,700 in 2024[18] Mortgage Loans and Banking - In 2025, the company closed approximately 16,400 mortgage loans with an aggregate principal amount of approximately $6.0 billion, compared to approximately 17,300 loans totaling approximately $6.3 billion in 2024[28] - Mortgage loans held for sale amount to $557,540,000 with an average interest rate of 6.0%[181] - The total fair value of mortgage loans held for sale is $571,596,000[181] Employee Count - As of December 31, 2025, the company had approximately 6,300 full-time employees, a decrease from approximately 7,000 employees as of December 31, 2024[32] Construction and Subcontracting - The company utilizes independent subcontractors under fixed price contracts for construction, ensuring no dependency on a small number of subcontractors[22] Interest Rate Risk and Strategy - The mortgage banking segment is exposed to interest rate risk, with strategies in place to mitigate this through forward sales contracts[179] - The average interest rate for mortgage loans held for sale is significantly higher than that of interest-bearing deposits, indicating a potential margin opportunity[181] - The overall interest rate sensitivity suggests a cautious approach to future rate changes impacting profitability[181] Liquidity and Financial Position - The company maintains a strong liquidity position with substantial interest-bearing deposits[181] - Interest-bearing deposits in the homebuilding segment total $1,827,493,000 with an average interest rate of 3.6%[181] - Fixed rate obligations are recorded at $900,000,000 with an average interest rate of 3.0%[181] - The company has no fixed rate obligations maturing before 2030, indicating a long-term liability strategy[181] Geographic Operations - The company operates in four geographic regions: Mid Atlantic, North East, Mid East, and South East[19] Future Expectations - The company expects to settle substantially all of its December 31, 2025 backlog during 2026, barring cancellations[20]

Core Insights - NVR, Inc. reported its Q4 and full-year 2025 results, showcasing performance consistent with expectations for a leading homebuilder during a challenging market period [1] Financial Performance - The financial results indicate that NVR is effectively navigating a tough environment, maintaining its status as a top operator in the homebuilding sector [1]

Core Insights - NVR, Inc. reported better-than-expected fourth-quarter 2025 results, with earnings and Homebuilding revenues exceeding the Zacks Consensus Estimate, although both metrics declined year-over-year [1][10] Financial Performance - Earnings per share were $121.54, surpassing the Zacks Consensus Estimate of $104.96 by 15.8%, but down 13% from $139.93 in the prior-year quarter [4] - Homebuilding revenues reached $2.635 billion, exceeding the consensus mark of $2.375 billion by 12%, while consolidated revenues totaled $2.713 billion, down 4.7% year-over-year [4] - Homebuilding segment revenues declined 5.2% year-over-year, with settlements down 8.3% to 5,668 units, although the average selling price (ASP) for settlements increased by 3.3% to $464,900 [5] Market Conditions - The housing market remains soft, with affordability challenges persisting amid macroeconomic uncertainty and inflationary pressures [2] - Backlog units fell year-over-year, indicating caution among homebuyers, but a slight improvement in net new orders (up 3.3% to 4,951 units) suggests some optimism [2][7] Margins and Costs - Gross margin contracted by 320 basis points year-over-year to 20.4%, primarily due to higher lot costs and pricing pressures [6] - Contract land deposit impairments totaled approximately $35.7 million, contributing to the margin decline [6] Mortgage Banking - Mortgage banking fees grew 19.3% year-over-year to $77.4 million, while closed loan production totaled $1.51 billion, down 11% year-over-year [8] - The capture rate in the fourth quarter was 84%, down from 86% in the previous year [8] Yearly Overview - For the full year 2025, Homebuilding revenues were down 1.9% year-over-year to $10.09 billion, with earnings per share of $436.55, a decrease of 13.8% [9]

Financial Performance - For Q4 2025, NVR reported net income of $363.8 million, a decrease of 20% from $457.4 million in Q4 2024, with diluted earnings per share down 13% to $121.54[1][2] - Consolidated revenues for the year ended December 31, 2025, were $10.32 billion, a 2% decrease from $10.52 billion in 2024, with net income also down 20% to $1.34 billion[2] - Homebuilding revenues for Q4 2025 were $2.64 billion, down 5% from $2.78 billion in Q4 2024, with a gross profit margin decreasing to 20.4%[4] - The effective tax rate for Q4 2025 was 22.4%, up from 20.1% in Q4 2024, primarily due to lower income tax benefits recognized[8] - Contract land deposit impairments negatively impacted gross profit margins, totaling approximately $75.9 million for the year ended December 31, 2025[5] Orders and Backlog - New orders in Q4 2025 increased by 3% to 4,951 units, while the average sales price decreased by 3% to $454,200 compared to Q4 2024[3] - The cancellation rate in Q4 2025 was 16.6%, slightly improved from 16.9% in Q4 2024, but settlements decreased by 8% to 5,668 units[3] - The backlog of homes sold but not settled as of December 31, 2025, decreased by 15% to 8,448 units, with a dollar value decrease of 16% to $4.01 billion compared to the previous year[3] - New orders for the year ended December 31, 2025, totaled 20,410 units with an average price of $456.2 thousand, compared to 22,560 units at an average price of $457.7 thousand in 2024, indicating a decrease in both units and average price[20] - The cancellation rate for new orders was 16.6% for the three months ended December 31, 2025, slightly improved from 16.9% in the same period of 2024[22] - The total backlog as of December 31, 2025, was 8,448 units with an average price of $474.4 thousand, down from 9,953 units at an average price of $481.4 thousand in 2024[20] Mortgage Banking - Mortgage closed loan production in Q4 2025 totaled $1.51 billion, an 11% decrease from Q4 2024, while income before tax from the mortgage banking segment increased by 24% to $57.2 million[6] - For the year ended December 31, 2025, mortgage closed loan production decreased by 4% to $6.04 billion, with income before tax from the mortgage banking segment down 2% to $152.0 million[7] - Loan closings in mortgage banking for the year ended December 31, 2025, were $6,039,621 thousand, down from $6,260,428 thousand in 2024, reflecting a decrease of approximately 3.5%[22] - The capture rate for mortgage banking remained stable at 84% for the year ended December 31, 2025, compared to 86% in 2024[22] Shareholder Equity and Liabilities - Total liabilities decreased from $2,170,916 thousand as of December 31, 2024, to $1,992,061 thousand as of December 31, 2025, representing a reduction of approximately 8.2%[18] - Shareholders' equity decreased from $4,210,072 thousand in 2024 to $3,864,869 thousand in 2025, a decline of about 8.2%[18] Share Repurchase and Outstanding Shares - The aggregate cost of shares repurchased in 2025 was $1,818,595 thousand, compared to $2,057,677 thousand in 2024, indicating a decrease of approximately 11.6%[22] - The number of shares outstanding decreased from 3,011,644 at the end of 2024 to 2,799,387 at the end of 2025, a reduction of about 7.0%[22] Community Growth - The average active communities increased to 450 in 2025 from 426 in 2024, showing a growth of about 5.6%[22]

分组1 - NVR reported quarterly earnings of $121.54 per share, exceeding the Zacks Consensus Estimate of $104.96 per share, but down from $139.93 per share a year ago, resulting in an earnings surprise of +15.80% [1] - The company achieved revenues of $2.64 billion for the quarter, surpassing the Zacks Consensus Estimate by 11.95%, although this is a decrease from $2.78 billion in the same quarter last year [2] - NVR has outperformed the S&P 500 with a 2.8% increase in shares since the beginning of the year compared to the S&P 500's gain of 1.9% [3] 分组2 - The current consensus EPS estimate for the upcoming quarter is $105.87, with expected revenues of $2.38 billion, and for the current fiscal year, the EPS estimate is $411.62 on revenues of $9.33 billion [7] - The Building Products - Home Builders industry is currently ranked in the bottom 2% of over 250 Zacks industries, indicating a challenging environment for stocks in this sector [8] - PulteGroup, another company in the same industry, is expected to report a quarterly earnings decline of -20.6% and revenues down 12.4% from the previous year [9][10]

Core Insights - Crude Value Insights provides an investment service and community focused on the oil and natural gas sectors, emphasizing cash flow generation and growth potential [1] Group 1 - The service offers subscribers access to a model account with over 50 stocks, detailed cash flow analyses of exploration and production (E&P) firms, and live discussions about the sector [1]

Core Viewpoint - Stock splits do not alter a stock's intrinsic value but tend to increase investor interest, often leading to a rise in stock prices post-announcement [1][2]. Group 1: Booking Holdings - Booking Holdings is the most likely candidate for a stock split among high-priced stocks, having previously executed a reverse stock split 23 years ago [5]. - As a consumer-facing business, Booking Holdings appeals to individual investors, making a forward split attractive as it would lower share prices and increase share count, enhancing affordability [6]. - Current market data shows Booking Holdings trading at $5,098.04 with a market cap of $164 billion and a gross margin of 97% [7]. Group 2: NVR - NVR, trading at $7,762 per share, is unlikely to announce a stock split due to its asset-light business model and a history of avoiding stock dividends [8]. - NVR has consistently outperformed the market but has no plans for a stock split in the near future [8]. Group 3: Seaboard - Seaboard operates in diverse sectors including pork production, grain processing, and maritime shipping, but its volatile business model makes it a less likely candidate for a stock split [9]. - The company has experienced double-digit revenue growth in three of the last five years, but negative results in the other two years raise concerns about the timing of a potential split [10].

Core Viewpoint - NVR, Inc. is anticipated to report lower earnings and homebuilding revenues in Q4 2025 due to soft demand, high inventories, and margin pressures [1][11]. Financial Performance - In the last reported quarter, NVR's earnings and homebuilding revenues exceeded the Zacks Consensus Estimate by 4.1% and 6.3%, respectively, but both metrics declined year-over-year by 14% and 4.4% [1]. - The Zacks Consensus Estimate for Q4 EPS has decreased to $104.96 from $105.42 over the past 30 days, indicating a 25% decrease from the year-ago EPS of $139.93 [3]. - The consensus revenue estimate is $2.35 billion, reflecting a 15.4% decline from the previous year's figure of $2.78 billion [3]. Market Conditions - The homebuilding industry is experiencing ongoing softness, with demand conditions remaining uneven due to affordability pressures and weakened consumer confidence [4]. - High and volatile mortgage rates, along with broader economic and geopolitical uncertainties, are likely limiting homebuyer activity [4]. Revenue and Settlements - Homebuilding revenues, which accounted for 97.8% of total revenues in 2024, are expected to decline by 16% year-over-year to $2.3 billion in the upcoming quarter [5]. - Total settlements are anticipated to decrease by 18% to 5,067 units year-over-year [5]. Cost Pressures - The company's bottom line is expected to decline year-over-year due to increased building materials and labor costs, with homebuilding gross margin projected at 21.1%, down 250 basis points from the previous year [6][11]. Orders and Backlog - Total new orders are predicted to increase by 8.9% year-over-year to 5,192 units, while the backlog is expected to decline to 9,290 units from 9,953 units reported a year ago [7]. - The value of the backlog is projected to be $4.5 billion, down from $4.8 billion in the same quarter last year [7]. Earnings Prediction - The model does not predict a conclusive earnings beat for NVR in the upcoming quarter, as the company lacks the necessary combination of a positive Earnings ESP and a favorable Zacks Rank [8]. - NVR currently has an Earnings ESP of +8.98% and a Zacks Rank of 4 (Sell) [9].

Group 1 - BofA has lowered the price target on NVR to $8,400 from $9,200 while maintaining a Buy rating on the shares [1] - Homebuilder stocks have rallied sharply year-to-date after underperforming the market in 2025 [1] - The firm anticipates that weaker employment and migration trends, ongoing inflation, and a competitive selling environment will pressure fundamentals through 2026, marking it as a "reset year for homebuilders" [1]

Industry Overview - The housing market is struggling as high mortgage rates deter potential buyers, leading sellers to refrain from lowering asking prices [1] - Additional challenges include aggressive immigration enforcement affecting the construction labor force and high tariffs on building materials like lumber, aluminum, and steel [1] Company Analysis: Lennar Corp. - Lennar reported a nearly 6% year-over-year revenue decline in Q4 2025, with shrinking margins [3][4] - Gross margins fell to 17% in Q4, with expectations of further declines to 15-16% in Q1 2026 [4] - The company projects full-year 2026 deliveries of approximately 85,000, significantly below market expectations [4] - LEN shares have dropped over 20% year-to-date, with bearish indicators suggesting further downside [5] Company Analysis: Meritage Homes Corp. - Meritage Homes, with a market cap of $4.6 billion, reported a Q3 2025 revenue of $1.4 billion, missing estimates by over 6% [6][7] - Margins fell from 21.4% to 20.1% in Q3, and the company's spec business model may lead to increased liabilities in a slowing market [7] - Despite a brief share price increase, MTH shares have since declined, indicating collapsing momentum [9] Company Analysis: D.R. Horton - D.R. Horton, with a market cap of $42.5 billion, reported a revenue decline of only 3% year-over-year, outperforming many competitors [11] - The entry-level housing market remains stagnant, with many potential buyers unable to make down payments or unwilling to move from low-rate mortgages [13] - The company's fiscal Q4 2025 margin dropped to 20%, and the stock has decreased by 15% since early December [13][14] Company Analysis: NVR Inc. - NVR operates an asset-light business model and has seen a revenue decline of 4.5% year-over-year in Q3 2025 [16][18] - Although NVR shares are down only 10% year-to-date, bearish momentum is building, with technical indicators suggesting a potential dip [18] Company Analysis: Tri Pointe Homes Inc. - Tri Pointe focuses on high-net-worth areas but faces challenges as high mortgage rates prevent homeowners from moving up [19][20] - Despite beating recent earnings projections, revenue is declining year-over-year, and management has lowered margin guidance [21]