NVR (NVR) Interest Coverage

: 72.10 (As of Dec. 2023)

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Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. NVR's Operating Income for the three months ended in Dec. 2023 was $490 Mil. NVR's Interest Expense for the three months ended in Dec. 2023 was $-7 Mil. NVR's interest coverage for the quarter that ended in Dec. 2023 was 72.10. The higher the ratio, the stronger the company's financial strength is.

Good Sign:

Ben Graham prefers companies' interest coverage to be at least 5. NVR Inc has enough cash to cover all of its debt. Its financial situation is stable.

The historical rank and industry rank for NVR's Interest Coverage or its related term are showing as below:

NVR' s Interest Coverage Range Over the Past 10 Years
Min: 20.57 Med: 33.67 Max: 70.36
Current: 70.36

NVR's Interest Coverage is ranked better than
83.56% of 73 companies
in the Homebuilding & Construction industry
Industry Median: 8.9 vs NVR: 70.36

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

NVR Interest Coverage Historical Data

The historical data trend for NVR's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

* Premium members only.

NVR Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Interest Coverage

41.30

27.30

30.87

57.88

70.36

NVR Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Interest Coverage																84.12	60.63	70.18	79.04	72.10

Competitive Comparison

For the Residential Construction subindustry, NVR's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

NVR Interest Coverage Distribution

For the Homebuilding & Construction industry and Consumer Cyclical sector, NVR's Interest Coverage distribution charts can be found below:

* The bar in red indicates where NVR's Interest Coverage falls into.

NVR Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage

-1

Operating Income

Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt ⁽¹⁾.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

NVR's Interest Coverage for the fiscal year that ended in Dec. 2023 is calculated as

Here, for the fiscal year that ended in Dec. 2023, NVR's Interest Expense was $-28 Mil. Its Operating Income was $1,952 Mil. And its Long-Term Debt & Capital Lease Obligation was $1,014 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Dec. 2023 )	/	Interest Expense (A: Dec. 2023 )
	=	-1	*	1951.664	/	-27.74
	=	70.36

NVR's Interest Coverage for the quarter that ended in Dec. 2023 is calculated as

Here, for the three months ended in Dec. 2023, NVR's Interest Expense was $-7 Mil. Its Operating Income was $490 Mil. And its Long-Term Debt & Capital Lease Obligation was $1,014 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Dec. 2023 )	/	Interest Expense (Q: Dec. 2023 )
	=	-1	*	489.649	/	-6.791
	=	72.10

The higher the ratio, the stronger the company's Financial Strength is.

NVR (NYSE:NVR) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .

NVR Interest Coverage Related Terms

Thank you for viewing the detailed overview of NVR's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.

NVR (NVR) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Homebuilding & Construction » NVR Inc (NYSE:NVR) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

N1VR34:Brazil

Address

11700 Plaza America Drive, Suite 500, Reston, VA, USA, 20190

Website

https://www.nvrinc.com

NVR Inc is a United States-based homebuilding company operating in over 33 metropolitan areas across the east of the Mississippi River. The company builds single-family detached homes, townhomes, and condominium buildings under three brands, Ryan Homes, NVHomes, and Heartland Homes. NVR's avoidance of direct land development activity is unique among public homebuilders and results in relatively outsize return metrics. The Virginia-based company also manages mortgage banking segment and homebuilding operating segments. The homebuilding segment includes four geographic areas; Mid-Atlantic, North East, Mid-East, and South East.

Executives

Daniel David Malzahn	officer: Chief Financial Officer	11700 PLAZA AMERICA DRIVE, SUITE 500, RESTON VA 20190
Paul C Saville	officer: Executive Vice President, CFO	C/O NVR INC, 7601 LEWINSVILLE ROAD SUITE 300, MCLEEAN VA 22102
Susan Williamson Ross	director	11700 PLAZA AMERICA DR, SUITE 500, RESTON VA 20190
Eugene James Bredow	officer: Controller	11700 PLAZA AMERICA DRIVE, SUITE 500, RESTON VA 20190
Matthew B. Kelpy	officer: VP, Chief Accounting Officer	11700 PLAZA AMERICA DRIVE, SUITE 500, RESTON VA 20190
Melquiades R. Martinez	director	450 SOUTH ORANGE AVENUE, SUITE 250, ORLANDO FL 32801-3443
Alfred E Festa	director
Charles Elliott Andrews	director	C/O H&R BLOCK, ONE H&R BLOCK WAY, KANSAS CITY MO 64105
Sallie B Bailey	director	FERRO CORPORATION, 1000 LAKESIDE AVENUE, CLEVELAND OH 44124-1147
Thomas D Eckert	director	1997 ANNAPOLIS EXCHANGE PARKWAY, SUITE 410, ANNAPOLIS MD 21401
Manuel H Johnson	director	C/O NVR INC, 7601 LEWINSVILLE ROAD SUITE 300, MCLEEAN VA 22102
Paul W Praylo	officer: SVP, Chief Operating Officer	11700 PLAZA AMERICA DR, SUITE 500, RESTON VA 20190
Alexandra A Jung	director	11700 PLAZA AMERICA DR, SUITE 500, RESTON VA 20190
Jeffrey D Martchek	officer: President of Homebuilding Ops	11700 PLAZA AMERICA DRIVE, SUITE 500, RESTON VA 20190
David A Preiser	director