|Crest Nicholson Holdings
||EPS - Basic
||Market Cap (m)
Crest Nicholson Share Discussion Threads
Showing 2051 to 2072 of 2075 messages
|Thanks for the links.
The link shows no earnings revisions for Crest Nicholson in March and 1 downgrade in February doesn't it, so nothing at all current in terms of today's shareprice decline? As I read the chart, the reason the "low value" line shows a drop in the 24th March period is that they have added an estimate from a new analyst (so the grey bars show 6 unchanged estimates rather than the 5 unchanged estimates for the previous period) which is in itself unchanged from the previous estimate from that analyst, but is the "low" one of the set of 6 and so appears on the "low" line.
Redrow may well be a better investment than Crest. I don't know because I haven't studied Redrow in detail. I do however think there is a reasonable chance that Redrow get themselves drawn into a bidding battle with Galliford Try (and maybe even someone else) over Bovis and I don't know how the Redrow shareprice might react to that in the short term.|
|Brokers have already started to downgrade EPS, Revenue and PBIT as seen here on the consensus revisions page. These will drop further if other brokers follow suit:
Compare this to Redrow who's figures have all been upgraded following their more bullish perspective:
You will also note that Redrow trades on a lower forward P/E due to its expected superior growth, despite reporting 4 months earlier than Crst (June year end vs Oct year end).
The decision to cut the LTIP vesting criteria was also accompanied by a luke warm trading update at the AGM and an argument that 8% profit growth was a stretch target which spooked investors given precious guidance.
With insider information the fact that the BODS and remuneration comittee see a mere 8% growth in PBIT as a stretch target suggests they expect not to grow anywhere near as fast as even the consensus EPS figures suggest on the above link, which is why this is starting to retrace significantly and brokers have already started to downgrade the figures.
Redrow on the other hand have a much more bullish LTIP vesting criteria based on achieving a whopping 82p EPS in 2019. I know which stock I now prefer and think will outperform.. not this one!|
|This (the ltip pbt criteria) is not new news though. The annual report which contains the information was published quite some while ago. The only new bit is the result of the vote which has perhaps given the relevant section of the annual report a bit more exposure.
I'm not aware of any brokers downgrading their eps targets. Can you provide some backup for that statement? In fact the only recent broker rating I've noticed has been today's reiteration of "overweight" from JP Morgan. Now since their previous price target (from November) according to the N&P site was 550p that suggests if anything they might have increased their target if they are reiterating overweight at the current price.
And according to the FT the fact that the profit targets looked "undemanding" in light of brokers eps forecasts is one reason the ISS shareholder advisory group recommended voting against the report.
I think it more likely that today's fall is largely profit-taking after a good run, a mildly unenthusiastic AGM trading statement (relative to other builders' recent updates) and a bit of negative headline news on the remuneration vote.|
|No surprise to see a sizeable drop here today on the back of the very disapointing ltip vesting criteria downgrade. Even the stretched targets suggest crest is not on target to reach broker consensus profits over the next 3 years, or indeed if it is the ltip criteria are far too easily achievable. Either way the downgrade has led brokers to downgrade their own eps targets which has eroded the implied value here and thus share price. This issue could well overshadow crest for some time to come and thus redrow and tef look superior options at current levels.|
|I am a big holder of TEF too; no on 2017 P/E crest is better value but you are failing to recognise the growth moving forwrad and the different year ends- TEF is better value.
Also you can't just compare P/E you need to factor in the different dividend streams, if you do TEF is still better value.
RDW actually has an even better track record than CRST of outperforming profit expectactions and when factoring in EPS growth and dividends combined is on a similar level than CRST but likely to poutperform it IMO as it usually underpromises and over delivers.
TEF still better value than both. RDW and TEF also cheaper on net assets.|
|TEF is a big holding for me, but I'm not sure it's going to beat CRST on p/e for FY17 eps is it? The recent TU from Redrow looked to me suspiciously like it might have had half an eye on a paper bid for Bovis - so they may have been emphasising the positive in order to maximise the value of their paper in the short-term rather than setting out a conservative 2017 estimate that they were confident of beating comfortably. In fact I bought some Bovis on the back of that Redrow TU.
Note that the Crest LTIP metric is pbt per share, so you have to factor in the likely growth in shares as well.
You also perhaps should factor in Crest's recent track record of outperforming its pbt per share LTIP targets.|
|I’m not happy about the situation and I am now contemplating selling my entire CRST stake and buying Redrow and TEF instead. TEF is better value on all metrics and RDW very similar value but with a more bullish management team.
I don’t like the fact that CRSTS LTIP target of 6-8% growth in PBIT doesn’t tie up with its revenue target of 1.4bn; how are they going to grow revenue by 40% and pbit by a compounded rate of 6-8% per annum until 2019 or 19-25% compounded. That implies an erosion of margins with current pre tax profit margin of 19.5% their figures imply that Profit before tax will grow to 195*1.06^3 =232mn but with revenue of 1400mn = 16.5 pre tax profit margin. Or at 8% which is the full vesting target of 195*1.08^3 = 245mn/1400 = 17.5%
This is well below broker forecasts, even the downgraded ones now out on 4-traders.com. This pales in contrast to RDW’s significantly uprated figures and for that reason I think it’s time shareholders dump this stock. The LTIP target does not tie up with the revenue growth target.|
|And perhaps worth commenting that 6% pa PBT-per-share growth over the next 3 years for a business with good top line growth expected and a trailing PE of about 9 seems pretty good to me.|
|This was a major part of the formal AGM session. Crest knew which way the wind was blowing, from conversations with shareholders ahead of the meeting, and gave a rather odd presentation on the matter - basically arguing that it was a particular part of the 2017 long-term performance plan that was the problem and that "in the round" shareholders were happy with the  remuneration policy. You can see from the voting that the "remuneration policy" was comfortably approved, but the "remuneration report" was not approved.
The part that caused the problem apparently was the 2017 LTIP Profit before tax metric. Here the threshold is 5% (25% vesting if cumulative annual nominal growth in PBT per share over 3 years is at least 5%), target is 6% and maximum is 8%.
The objection is that the targets were much higher in the previous year's plan (16% threshold, 18% target, 20% maximum in the 2016 LTIP covering the 3 years to 2018.).
The Crest argument is given in the annual report:
"With regard to the PBT element, following a period of very strong growth up to the end of 2016, we anticipate a temporary slowdown in profit growth during the next three-year performance period as we invest in the business towards medium-term targets of £1.4bn sales and 4,000 units in 2019....The threshold of 5% p.a. is in line with the typical threshold growth targets at FTSE 250 companies, while the target of 6% is in line with our internal long-term plan."
I hadn't noticed this section before, but the disclosure of the 6% number in their internal plan is interesting in the context of investors building their own spreadsheets with profit estimates.
The average growth in the PBT metric over the 3 years 2014-2016 was 36.0% p.a. according to my reading of the annual report.
While the pay controversy is interesting, the insight it gives into expected underlying profitability is perhaps more relevant to investors. It would suggest that Crest management believe that after a period of staggering outperformance as they recovered from the mess of the financial crisis the business is now headed for a period of more pedestrian profit growth.|
|Investors claim first scalp as pay revolt gathers pace - HTTP://www.thetimes.co.uk/edition/business/investors-claim-first-scalp-as-pay-revolt-gathers-pace-cj58tjmbq
The backlash against excessive pay and bonuses heated up yesterday after investors voted against generous awards to Crest Nicholson directors in a new wave of shareholder revolt...|
|Agree. I was expecting to come across a "however" as I read through it. But perhaps they're emphasising the "stretching" nature of the targets to try to head off shareholder discontent with the remuneration package.
Something to ask about at the AGM today perhaps.|
|Appears to lack enthusiasm to me.|
|Steady as she goes seems to be the message from the statement.|
|BKG, BWY and RDW all saying good things about current trading. Let's hope CRST continues the trend with an AGM statement tomorrow.|
|Good report from Bellway|
|Crst share price benefitting from the BKG statement this morning I think:
"The housing market in London and the South East has now stabilised. Overall, underlying reservations in the seven months since the immediate Brexit referendum effect (August to February) are down 16% on the comparable period last year, with the last two months ahead of last year. Enquiry levels remain robust, cancellation rates are at normal levels and pricing continues to be resilient and above business plan levels."
|Price drop today on account of it going ex-dividend
to the tune of 18.5 pence|
|They don't always give a Trade Update at AGMs
Meanwhile I take holding comfort from this|
|I'm trying hard not to take more profit at the moment. In fact I've been buying BKG and taken a smaller position in BVS as well.
There's a BKG TU on Friday, the CRST AGM (and presumably TU) on 23rd March and the takeover code deadline for Bovis on 9th April. On the other hand you've got today's Fed decision & press conference plus the formal triggering of Brexit.
I'm hoping for continued positive sentiment from BKG and CRST management on the outlook for the housing market (after all the spring selling season must be in full force now mustn't it?) and some competition between Redrow, Galliford Try (and someone else?) for Bovis. I think this could scare out a lot of the short positions in the UK housebuilders and cause a decent squeeze higher in the prices.
But of course, if RDW and GFRD walk away from BVS, the market reacts badly to the Fed dot plot and people start getting worried about the realities of brexit again then it could all head south.|
|Salpara, interesting !
Myself, I'm keeping a close watch on this chart|
Near all time high.
I have been in for over 2 years and have to say that I am tempted to take my money off the table.|
|And they've got a short position in AMEC.
A really bad Monday for them by the look of things.|