NVR - NVR Continues To Capitalize On Housing Shortage And High Mortgage Rates

2024-06-21 05:51:21 ET

Summary

• Although NVR stock slightly underperformed the broader market since my initial coverage, business drivers remain strong.
• Factors such as high mortgage rates, housing shortage, and potential interest rate cuts contribute to a favorable environment for NVR's medium-term performance.
• I believe the stock is undervalued compared to the company's potential, leading to the reiteration of my "Buy" rating.

Investment Thesis

NVR Inc. ( NVR ) was the first company I covered on Seeking Alpha. I initiated coverage in August 2023 with a “Buy” rating.

The drivers of the business have not changed much since then. Although the stock has slightly underperformed the broader market, I believe the outlook remains positive. High mortgage rates have mixed effects, not solely negative, as the market perceives. Combined with factors such as the housing shortage, the business is still attractive as an investment idea....

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