Mohnish Pabrai's Presentation and Q&A at the Boston College on October 27, 2022
Chai with Pabrai
NVR's 2% Annualized Share Con Reduction Is Not Enough
NVR stock went up 128x over that 11 year period, which is 55% annual. But if you look at this period from 94 to 2005, during that period, they bought back more than 9% a year. And then in the last five years, it's about 3% annualized. Their stock has also gone down about a third over that period. So when we look at that formula we had, which is the multiple, the growth in earnings with the amount of shares that are reduced and then the any kind of multiple expansion you get, a 2% annualized share reduction is unlikely to get you to the promised land.
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