NVR Whiffs on Earnings

NVR (NYS: NVR) reported earnings on July 22. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended June 30 (Q2), NVR met expectations on revenues and whiffed on earnings per share.

Compared to the prior-year quarter, revenue increased significantly. GAAP earnings per share expanded.


Gross margins contracted, operating margins expanded, net margins shrank.

Revenue details
NVR recorded revenue of $1.01 billion. The seven analysts polled by S&P Capital IQ predicted sales of $1.02 billion on the same basis. GAAP reported sales were 31% higher than the prior-year quarter's $771.1 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $10.11. The eight earnings estimates compiled by S&P Capital IQ averaged $12.14 per share. GAAP EPS of $10.11 for Q2 were 13% higher than the prior-year quarter's $8.97 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 16.6%, 130 basis points worse than the prior-year quarter. Operating margin was 8.4%, 10 basis points better than the prior-year quarter. Net margin was 5.0%, 110 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $1.09 billion. On the bottom line, the average EPS estimate is $14.80.

Next year's average estimate for revenue is $4.08 billion. The average EPS estimate is $50.54.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 250 members out of 518 rating the stock outperform, and 268 members rating it underperform. Among 161 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 83 give NVR a green thumbs-up, and 78 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on NVR is hold, with an average price target of $959.43.

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The article NVR Whiffs on Earnings originally appeared on Fool.com.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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