Focused on building reliable datasets, financial models, and research tools for value-minded investors. Committed to turning complex data into practical guidance for value-investing and long-term wealth.
Dr. Charlie Tian is the founder and CEO of GuruFocus.com, a leading global investment research platform established in 2004. With a Ph.D. in physics, Dr. Tian transitioned from science to finance, applying a data-driven, disciplined approach to value investing.
NVRNVR +2.57%88 Degree of Operating Leverage is 2.42 as of Jun. 2026. GuruFocus rates NVR with a GF Score™ of 88/100 and a GF Value™ of $7,670.59 (Modestly Undervalued). The stock has 2 warning signs investors should review. Among 87 Homebuilding & Construction companies, NVR ranks worse than 63.22% on this metric.
Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue.
NVR's Degree of Operating Leverage for the quarter that ended in Jun. 2026 was 2.42. The higher Degree of Operating Leverage, the higher operating risk the company will take.
The industry rank for NVR's Degree of Operating Leverage or its related term are showing as below:
NVR's Degree of Operating Leverage is ranked worse than 63.22% of 87
companies
in the Homebuilding & Construction industry
Industry Median: 1.39
vs NVR: 2.42
NVR (NYSE:NVR) Degree of Operating Leverage Explanation
Degree of Operating Leverage (DOL) is a leverage ratio that measures the sensitivity of a company’s operting income, also referred to as Earnings Before Interest and Taxes (EBIT), to fluctuations in its Revenue. DOL is a method used to quantify a company’s operating risk. This risk is related to the company's structure of variable costs and fixed costs. Since the fixed costs do not allow the company to adjust the operating costs, the operating risk rises with a higher fixed-to-variable costs proportion.
A high Degree of Operating Leverage indicates that the company’s fixed costs exceed its variable costs. By increasing the sales, the company can earn more profits. In addition, the company must be able to maintain relatively high sales to cover all fixed costs.
Be Aware
The use of operating leverage varies across different industries and business sectors, and the application of Degree of Operating Leverage (DOL) should be adjusted accordingly.
NVR Degree of Operating Leverage Related Terms
NVR Degree of Operating Leverage Historical Data
* Premium members only.
The historical data trend for NVR's Degree of Operating Leverage 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.
NVR vs TOL, LEN, PHM: Degree of Operating Leverage Comparison
For the Residential Construction subindustry, NVR's Degree of Operating Leverage, along with its competitors' market caps and Degree of Operating Leverage 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 Degree of Operating Leverage vs Homebuilding & Construction Industry
For the Homebuilding & Construction industry and Consumer Cyclical sector, NVR's Degree of Operating Leverage distribution charts can be found below:
* The bar in red indicates where NVR's Degree of Operating Leverage falls into.
* 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.
** TTM data of EBIT and Revenue was used to calculate Degree of Operating Leverage.
*** Please be aware that the Degree of Operating Leverage calculations are based on company-level data using the primary share class. The calculated data provided is for demonstration purposes and may slightly differ from the results displayed in the title due to potential variations caused by currency exchange rate differences throughout the year.
What does a Degree of Operating Leverage of 2.42 mean?
NVR (NVR) has a Degree of Operating Leverage of 2.42 as of Jun. 2026. Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue. View historical data for NVR and its competitors. According to the industry distribution chart, NVR ranks #55 out of 87 companies in the Homebuilding & Construction industry, placing it in the top 63.2%.
Is NVR's Degree of Operating Leverage too high?
NVR's current Degree of Operating Leverage is 2.42. The Homebuilding & Construction industry median Degree of Operating Leverage is 1.39. NVR's value of 2.42 is 74.1% above this industry median. Based on the distribution chart, NVR ranks #55 out of 87 companies in the Homebuilding & Construction industry, which is below the industry midpoint. Overall, NVR has a GF Score™ of 88/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does NVR's Degree of Operating Leverage compare to TOL and LEN?
According to the Homebuilding & Construction industry distribution chart, NVR ranks #55 out of 87 companies for Degree of Operating Leverage. This places NVR in the lower half of its industry. The industry median Degree of Operating Leverage is 1.39. NVR's value of 2.42 is 74.1% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Degree of Operating Leverage for a Homebuilding & Construction company?
The median Degree of Operating Leverage among Homebuilding & Construction companies is 1.39, based on 87 companies in the industry. Companies in the top quartile (top 25%) have a Degree of Operating Leverage significantly above this median, while those in the bottom quartile fall well below. However, Degree of Operating Leverage should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. NVR's current Degree of Operating Leverage of 2.42 is 74.1% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Degree of Operating Leverage mean?
A high Degree of Operating Leverage can signal that a stock is expensive relative to its fundamentals. Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue. View historical data for NVR and its competitors. For the Homebuilding & Construction industry, the median Degree of Operating Leverage is 1.39 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. NVR's current Degree of Operating Leverage is 2.42. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is NVR stock overvalued right now?
Based on GuruFocus' analysis, NVR (NVR) is currently considered Modestly Undervalued. The stock's GF Value™ is $7,670.59, compared to a current price of $6,348.13 — trading 17.2% below its estimated fair value. The current Degree of Operating Leverage is 2.42 and 74.1% above the Homebuilding & Construction industry median of 1.39. NVR's overall GF Score™ is 88/100 with 2 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Degree of Operating Leverage calculated?
Degree of Operating Leverage is calculated from a company's financial statements. For NVR (NVR), the current Degree of Operating Leverage is 2.42 as of Jun. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is NVR (NVR) Overvalued in 2026?
Based on GuruFocus' analysis, NVR stock appears to be undervalued.
The current stock price of $6,348.13 is trading 17.2% below its estimated GF Value™ of $7,670.59.
GuruFocus considers NVR to be Modestly Undervalued.
Key valuation signals for NVR:
Degree of Operating Leverage: 2.42
GF Value™: $7,670.59 vs. price of $6,348.13 (17.2% below fair value)
Industry Position: 74.1% above the Homebuilding & Construction median (#55 of 87)
No single metric tells the full story. See the NVR stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
NVR Inc is a US homebuilder operating through two segments: Homebuilding and Mortgage Banking. The company builds and sells single-family detached homes, townhomes, and condominiums, primarily on a pre-sold basis, and markets them under brands including Ryan Homes, NVHomes, and Heartland Homes. Its homebuilding operations serve buyers across the Mid-Atlantic, Northeast, Mid-East, and Southeast regions of the United States, with a concentration in the Mid-Atlantic. In addition to construction, NVR provides mortgage banking and title services to its homebuyers, capturing additional revenue at the point of sale. The company is known for its lot acquisition strategy, which emphasizes option agreements over direct land ownership, reducing capital tied up in land. Revenue is derived mainly from home sales, supplemented by mortgage banking and title fees.
88GF Score
Get the complete analysis for NVR
Degree of Operating Leverage is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
NVR has been successfully added to your 
