screaming buy |
buyWell..........ington boots. :) |
Financials now stand on an edge of sorts
Builders need to provide piles of supports
All UK ones are now showing weak foundations
buywell expects that to spread to many nations |
Might top up, remember buy low sell high |
I don't think Bellway built many high rise apartments so should not be affected like other companies |
V other FTSE100 stocks this confirms a deteriorating picture of UK Housebuilders in the face of rampant inflation now forecast for the rest of 2022 and now forecast to last for years
buywell was helped long ago by Mr Ashley James so here is a heads up on the above chart/sector
This is what Mr Market thinks
FTNMX501010 --- FTSE 350 Construction & Building Materials Technical Analysis
Summary:
STRONG SELL
Moving Averages: STRONG SELL --------- Buy(2) Sell (10)
Technical Indicators:STRONG SELL ----- Buy(0) Sell (10)
Do you rampers really think you know more than Mr Market ?
buywell lets it be a guide to decision making and suggests you do too
Very very occasionaly does Mr Market make mistakes , and when it does it is usually on single small cap stocks --- this from many many years of watching and waiting.
Mr Market does NOT make mistakes regarding FTSE100 or very BIG Cap listed companies
dyor |
Excerpt from an article in Housing Today last week:
"Bellway, in common with the other signatories, confirmed it will remediate tower blocks over 18m in height it had developed over the past 30 years, without using money from the government’s Building Safety Fund. It said it has estimated the extra cost of doing this work to be £300m, on top of £186.8m already set aside for remediation since 2017.”
Bellway, in today’s statement said its “robust” £300m estimate assumes the housebuilder incurs the whole cost of remediation. However it added:” The group has already recognised total recoveries of £29.7 million since 2017 and will continue to pursue further recoveries from suppliers, subcontractors, professional advisors and others, where they have a liability, although we note that these are likely to be unavailable where contractual limitation periods have expired.”" |
As a BWY holder I was interested to see in the FT a couple of days back that an article showing the cladding provisions made by the leading builders and that the £480m provision made by Bellway was the highest in the sector...even larger than that of Barratt and almost double that of TW. |
jurgenklopp
I have no idea what PCA means-Personal Care Assistant???, I was not sure if she was wife or daughter but still of course good news and congrats to those who bought last week |
Another director bought £50k |
Wife of Chairman just bought £500k worth of shares.
Tremendous show of faith. |
 The IC view:
--
Some are speculating that the UK housing market could witness a slowdown if the Bank of England continues to ratchet up interest rates. That’s a logical conclusion, but it’s worth remembering that the UK base rate has averaged 7.2 per cent from 1971 through to 2022. Even if the Monetary Policy Committee remains resolutely hawkish over the next 12 months, it’s probable that borrowers will still only have to contend with modest interest rates from a historical perspective.
Bellway (BWY), one of the UK’s five leading housebuilders, didn't seem overly concerned by a prospective increase in borrowing costs, as it detailed an 11.6 per cent increase in underlying half-year operating profit to £332mn, accompanied by a 140 basis point increase in the associated margin to 18.7 per cent. Margin growth has been achieved against an inflationary backdrop, including upward pressure on employee costs.
Apart from inflationary pressures, the group will have to deal with the fallout from the Grenfell Tower disaster for a while longer. Bellway said it had provided an additional £22.1mn for remedial works, bringing the total spend to £187mn, although the group has clawed back around £30m from suppliers and subcontractors, “where they have fallen short of the standards required”.
The builder’s order book has increased by roughly a quarter since midway through March in 2021, with the underlying value of the homes up by a third to £2.21bn. Management is guiding for a 10 per cent increase in volume growth through the year, with an average selling price of £305,000 – slightly down on the level at July 2021, but in advance of earlier guidance. The land bank has increased by 15 per cent year on ear, which should assist the group in achieving its volume target of around 12,200 homes in FY 2023, an increase of a fifth on July 2021.
Interim details had been foreshadowed in a February trading update, although the group’s shares drifted downwards on results day. Interest rates aside, prospects for housebuilders could be imperilled by a general fall in aggregate demand and investment if price rises persist over a lengthy period, particularly if they translate to job losses into the economy. Bellway shares change hands at six times consensus forecast earnings, so we reiterate our previous position that Bellway’s “lowly rating leaves room for missteps, some unexpected headwinds, and solid returns”, while management maintains that the group “can balance volume growth with higher dividend returns for shareholders”. Buy. |
Tipped as BUY in IC |
I bought in on Friday seems very cheep to me . |
Oh no - I must be in peril here then - as I am with CRST! :-) |
Relentless downward pressure
Fight it at your peril
Rates are set to rise yet further due to gaseous effluence |
Hi Buywell, timing is clearly not everything, I think my example proved that. It also seems like you're pretty bad at timing the market as you've only started telling people to sell out when prices are already crashing... |
Thanks Buywell. I note that buying this April 2007 for 1,605p (just before it crashed) and selling today at 2,768p (~30% down from all time high) would have been awful market timing but would still have produced a gain of 72%, excluding dividends which were paid every year. |
Housebuilders nearly all dropping today as many other sectors rise
IMO fight this at your peril
Rising rates are coming --- again and again and again
The market is starting to price this in but imo are playing catchup with inflation heading to 8% plus and still rising |
To show no bias
What happens in America and what is happening in America will result in what happens in the UK --- if you do your research you will corroborate this fact
The number of USA houses that were for sale has just risen by over 13% in feb year on year
ie Supply is now accelerating as the wise yanks want to cash in their brick piles
USA house/condo sales have dropped year on year for the last consecutive 7 months in a row
ie Demand is weakening
Ref New Builds or Houses under construction in the USA --- unsold numbers are now at 2008 levels and up 70% year on year --- this coupled with massive increased costs due to raw building materials causing stalls in many new build projects
Many USA builders could go bust if these remain unsold
Supply of new builds grows as existing sales of old/ used houses stalls
Inflation in the USA is now at 40 year highs
The FED plans to do another 6 rate rises in 2022
The 30yr fixed mortgage rate stands at circa 4.4% now and is thus on track to hit 6% by the end of this year
Inflation is not going away and the FED wants it at 2% --- next month it will likely hit 9% and still rising
The USA property market is now in top end bubble territory and soon to pop
The UK property market follows the USA with a lag of 12 months
dyor |
I find the following noteworthy: "the use of Help-to-Buy fell to just 18% of total reservations (2021 - 41%), a marked reduction compared to previous years."
This suggests that it is actually possible to sell new builds without government support for (wealthy) buyers.
I favour Bellway within this sector because of its impressive track record and very dull strategy for delivering more of the same for years to come:
"The Board believes that value generation is best evaluated through capital growth, by increasing the net asset value per share ('NAV'), together with the payment of a regular dividend." I note that BWY trades at a lower price/book than TW., PSN or BDEV. I believe this is because BWY is so boring that everyone has forgotten that it exists. |
...from Q4 last year...
Bellway plc issued prelims for the year ended 31st July 2021 yesterday. Revenues were up 40%, Operating profit 65% and EPS over 100%. The company also reported a net cash pile of £330m. Strong recovery in profitability, supported by good market conditions and a robust balance sheet and a total dividend per share of 117.5p was proposed, a rise of 135%. Home building is recovering from lockdowns, revenues are nearly back at FY19 levels, EPS and DPS still a little way off. Business momentum is positive and valuation is attractive. Forward PE ratio of 9 is top quartile for the Homebuilding & Construction Supplies sector. Meanwhile, the balance sheet is healthy. We would expect the share price to return to pre-Covid peaks next year and kick on to new record highs. There are decent returns here. BUY....from WealthOracleAM |
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