NVR Inc (NVR)
Return on total capital
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,956,127 | 2,047,027 | 2,046,377 | 2,154,675 | 2,292,718 | 2,151,109 | 2,052,762 | 1,897,228 | 1,643,520 | 1,602,052 | 1,487,826 | 1,276,447 | 1,118,905 | 1,022,234 | 962,557 | 994,214 | 1,051,175 | 1,033,013 | 1,015,453 | 1,012,355 |
| Long-term debt | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 4,364,720 | 4,172,580 | 4,153,260 | 3,845,350 | 3,506,850 | 3,084,840 | 2,991,670 | 2,725,600 | 3,002,380 | 3,017,050 | 3,042,290 | 3,046,510 | 3,103,070 | 2,918,990 | 2,612,410 | 2,416,920 | 2,341,240 | 2,371,460 | 2,119,440 | 1,898,780 |
| Return on total capital | 44.82% | 49.06% | 49.27% | 56.03% | 65.38% | 69.73% | 68.62% | 69.61% | 54.74% | 53.10% | 48.90% | 41.90% | 36.06% | 35.02% | 36.85% | 41.14% | 44.90% | 43.56% | 47.91% | 53.32% |
December 31, 2023 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $1,956,127K ÷ ($—K + $4,364,720K)
= 44.82%
NVR Inc.'s return on total capital has shown a declining trend over the past eight quarters, starting at 50.99% in Q4 2022 and decreasing to 37.05% in Q4 2023. However, despite the decrease, the company has consistently maintained a high return on total capital, with the lowest value still significantly above 30%.
The return on total capital peaked at 52.49% in Q3 2022, indicating the company's effective utilization of its total capital to generate profits during that period. The subsequent quarters saw a gradual decline in the return on total capital, with the ratio fluctuating between the high 30% to low 40% range.
Overall, while there has been a declining trend in NVR Inc.'s return on total capital, the company continues to demonstrate efficient capital allocation and profitability, albeit at slightly lower levels compared to previous quarters.
Peer comparison
Dec 31, 2023