We've been here before haven't we. Price recovers eventually |
Solid set of results, a little higher than I expected. Soon see what the market thinks. |
Never the bride. Always the bridesmaid. Until results day... |
Different market etc etc. Strategy sound and land bank is massive |
BKG vs BDEV, TW.,VTY tells its own story, directors (wives) have sold circa £14m shares in the last 6 months, divi all but cancelled, gone downhill since Tony Pidgley died imo, I'm out |
they class share buy backs as 'returns to shareholders' but buybacks/cancellations resulting in reduced shares in issue never reflect pro rata in share price enhancement (as shown by the chart)
poor imo & will consider my position (I'm getting 11.5% divi on STCM & my thinking is may as well gear up there!) |
9p dividend... |
BDEV read across re: dividend reinstated? |
lets see where this ends up i think long term hold |
BKG still my pick of the housebuilders & remains rock solid - 125m shares in issue so trending to annualised eps £4 @ p/e 12 or thereabouts should support share price of £50 with a 7%+ divi yield excluding any special cash distributions
SHAREHOLDER RETURNS
-- On track to deliver a pre-tax ROE of at least 15% on a cumulative basis from 1 May 2019 to 30 April 2025, which broadly equates to annual pre-tax profits of GBP500 million for the six year period.
-- Commitment to GBP280 million per annum Shareholder Returns up to 30 September 2025 re-affirmed, with next GBP140 million on track for payment by 31 March 2021, as previously announced.
-- GBP455 million of surplus capital to be allocated to either incremental new land investment or enhanced cash returns to shareholders over the period to 30 April 2023 |
Thanks and I take your point on them managing expectations. |
Indeed. I suppose it's on track and BKG are good at managing expectations. The surprises tend to be on upside.A 15% stop loss should protect you. |
What do we think of the update? Inline with guidance but 15 to 16 percent drop in profit and revenue never makes easy reading. Still, in these challenging times a decent set of results and in a strong position going forward. Could go either way at the opening IMO. |
Don't know if these results are good or not. No special cash return but I think politically this would have been difficult anyway.So, steady as it goes. |
It was split between dividend and share buybacks going through to March 21 |
Results due 4th |
Any change of the £3.50 dividend cancelled in March? |
Down 218p since your comment, sadly correct call. |
Thanks Donald, always good to hear from you. |
Up 89p....good call |
Is that you Donald?Only because no one commented yesterday and I expect more of a fall to come but we will see. |
Yesterday's RNS qv Your opinion is worthless so why share |
Not good news, the CEO selling 700,000. Expect a drop IMO |
Is this a good time to buy back into 'builders for their dividend potential? To find out more, we've taken a fresh look at the five largest listed housebuilders - Persimmon (LON: PSN), Berkeley Group (LON: BKG), Barratt Developments (LON: BDEV), Taylor Wimpey (LON: TW) and Bellway (LON: BWY).
More on the Investor's Champion website. |
 HL view today (still best risk/reward bet of the hb's imo)
4 September 2020 | A A A
Berkeley Group - robust trading
Berkeley Group's said recent trading had been resilient, and reiterated its guidance for £500m in pre-tax profit for the full year.
Production has been better than initially anticipated since lockdowns eased. The group's now running at about 90% of normal efficiency levels, so profit is expected to be split more evenly between the two halves of the year. Pricing has been "robust", although the value of underlying reservations is around 20% lower than last year. The group expects this to support its year end forward sales position of over £1.8bn.
Berkeley currently has more than £1bn in net cash (cash and cash equivalents minus debts), and will return £134.3m of this to shareholders as a dividend of 107p per share on 11 September. A further £140.1m will be returned to shareholders by the end of March 2021 through dividends and share buybacks.
The shares fell 1% following the announcement
Our View
Berkeley is back up and building after temporarily halting during the lockdowns. Strong pricing and efficient building have given management the confidence to give full year profit guidance.
In the long run, we think the UK housing market is reasonably attractive. Brits still love to own their own homes, all political parties see the need for more housebuilding and mortgages are relatively affordable. However, the sector is cyclical and highly exposed to economic shocks, and a sustained recession or second wave of coronavirus infections may still hit house prices.
Berkeley does offer something different to the other large builders because it operates at the pricier end of the market and has a large exposure to London. Many of its sites are technically challenging, and that's afforded it enviable margins in the past. Whether or not this exposure to more exclusive property proves to be an advantage depends on the nature of our economic recovery.
Berkeley has also tended to run a tight ship through the economic cycle - it's enjoying high margins now partly because of its deft management of the financial crisis. The balance sheet is currently packed with over £1bn of net cash, and the group had a further £250m in available credit at year end.
Unlike some of its peers, Berkeley is going forward with its original dividend and share buyback plans. This demonstrates management's confidence in the future, but we're mindful that until there's a clearer picture of what the medium-term is going to look like, this could prove to be over-confidence. Remember dividends are never guaranteed, and that's especially true in difficult times like these.
Overall, Berkeley offers a differentiated business model, and performance to date has been robust. If we can avoid further disruption, we think it's well positioned to bounce back. But "if" is doing a lot of work here - a prolonged shutdown or slow economic recovery will eventually whittle away Berkeley's capital. |
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