NVR - NVR gains 3.9% premarket as low mortgage rates inventory fuel demand in Q3

NVR (NVR) Q3 net income of $256.5M climbed 15% Y/Y as revenue of $1.99B rose 4.1% and beat the average analyst estimate of $1.97B.NVR gains 3.9% in premarket trading.New orders in the quarter increased by 40% to 6,681 units vs. a year ago, as strong demand was fueled by historically low mortgage interest rates and lower resale inventory levels.Q3 EPS of $65.11 exceeds the consensus of $58.89 and increased from $56.11 in the year-ago quarter.Homebuilding revenue of $1.92B increased 2.5% Y/Y; gross profit margin improved to 20.0% from 19.0% in Q3 2019.The average sales price of new orders of $384,200 increased 4% Y/Y.Cancellation rate decreased to 12% vs. 16% in Q3 2019.Backlog of home sold but not settled as of Sept. 30, 2020 increased 32% Y/Y to 12,124 units and 37% to $4.66B on a dollar basis.Mortgage banking unit closed loan production of $1.38B, up 1% Y/Y.

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NVR gains 3.9% premarket as low mortgage rates, inventory fuel demand in Q3