Taylor Wimpey Share Discussion Threads

[the_equaliser] 05/1/2017 13:53

Not PSN ......?

[raffles the gentleman thug] 05/1/2017 13:25

Hi garycook ... whilst I am a big fan of TW, I actually think BKG is the better bet here on management quality, visibility and valuation ... so still lovin' it

[steeplejack] 05/1/2017 11:28

I feel that these near Damascene experiences,when stocks suddenly rerate,a poor reflection of the City's ability to stay ahead of the curve.Of course,it might have something to do with the merry go round of generating a bit of business!

[the_equaliser] 05/1/2017 11:15

Looking from last RNS update,
Any improvements in the properties in london ?

[tlobs2] 05/1/2017 10:42

Be thankful for small mercies, we've not heard much from Mrs Cranky north of the Border for a couple of weeks ;-)

[bonio10000] 05/1/2017 10:34

Arja called this right then.

[tlobs2] 05/1/2017 10:27

It would still represent very good value at 220p

[garycook] 05/1/2017 10:12

Still a bargain at 167 !!! Looks like another BKG,ITV,undervalued.BKG was 2300,and ITV in the 160,s.What a difference in 2 months.Both up over 20%,and still over 20% upside still left.

[raffles the gentleman thug] 05/1/2017 09:37

And remarkably even at 167p it's still about highest yielding stock in FTSE with 8.2%

[3rd eye] 05/1/2017 08:39

TW. Taylor Wimpey......finally bought a house builder and this one looks the pick. Good item on the sector below the chart.



Why housebuilders offer 30% upside
By Harriet Mann | Wed, 4th January 2017 - 17:54

Why housebuilders offer 30% upside

The reward for taking the plunge into risky equities sometimes looks too good to miss. Prime minister Theresa May's imminent triggering of Article 50 has clouded the horizon for housebuilders, certianly, but the sector's tasty dividend yields, strong cash generation and 25% return on capital could mean 30% upside for share prices, the numbercrunchers at Deutsche Bank reckon.

While Britain's decision to leave the European Union came as a surprise, the real shock came from the stockmarket reaction. To reflect that, the analysts at Deutsche have adjusted their numbers to reveal significant untapped upside potential, with forecasts returning close to pre-Brexit levels. Pre-tax profits forecasts for 2017 have doubled, with 2018 numbers up by half and 2019 estimates up 20%.

But the sector is priced at just 1.3 times net tangible asset value (NTAV), which falls to 1.2 times in 2018. This "overplays" any risk to future earnings, says analyst Glynis Johnson, especially with return on capital employed (ROCE) worth up to three times its cost of capital.

Not only do the blue-chips trade with a yield over 6.5%, but their stream of free cash flow give scope for future upgrades - look to Barratt (BDEV), Persimmon (PSN) and Taylor Wimpey (TW.), says Johnson. The mid-caps are flirting with yields of 4.5%, which will provide added support to valuations.

With new ministers in charge of housing and a new White Paper due on our desks any time now, the sector could be in line for a fresh bout of volatility. But investors should keep their heads and buy the dips, adds the analyst.

"We believe any weakness in share prices around this time should be used as a buying opportunity with the sector likely to demonstrate steady reassurance through the year with its continuous cycle of trading updates."

Admitting the sector trades "relatively homogeneously", Deutsche has just upgraded McCarthy & Stone (MCS) to 'buy', joining Barratt Development, Berkeley Group and top pick Taylor Wimpey. Losing some of its shine, Bovis is cut to 'hold' as operational hiccups start to dent confidence.



Highest yielding blue-chip

Taylor Wimpey looks like it has the most to gain over the next few months, with a target price of 239p, implying 56% upside. It's also the highest yielding stock on the FTSE 100, boasting 8.7%.

"This meaningful, well covered yield in combination with the reassurance on future profitability and cash flow that its strong strategic land bank offers should become further appreciated in 2017 as investor nerves on the Brexit impact on the sector are proved to be overstated," says Johnson.

McCarthy is next in the pecking order with its target price of 211p suggesting the shares are worth 31% more. Investors have been wary of McCarthy's cautious customer base and lumpy completion timings since its IPO, which has weighed on sentiment.

But Deutsche reckons the shares are are "too cheap", especially as it continues to demonstrate its higher margin model and progress on its growth strategy. Its recent 45% slump - the sector's down only 20% - has taken the shares 10% below their IPO price, which has the Deutsche magpies upgrading the shares to 'buy'.

Barratt is trading below its sector average with a P/TNAV of 1.2x for 2017, which Johnson also flags as "too cheap". Barratt's strategic land bank is on the small size and its exposure to Greater London is certainly higher risk, but the housebuilder should lead the sector with its return on capital, thanks to its shorter landbank and expertese in public sector land. Not only does the 7.3% dividend yield turn heads but investors could untap 31% of upside.

The final 'buy', Berkeley, could be hit hard by changes to tax and mortgage regulation, the impact of stamp duty and Brexit negotations. But future completions in the run up to 2018 all have legally exchanged reservations, which eases most short-term concerns. Armed with a 7.1% yield and 20% return on equity potential, its 1.6 2018 P/NTAV again looks too cheap to Deutsche. It's share price could grow by nearly 27% if Johnson is correct, pencilling in a target of 3,559p.

It wasn't all good news in the 'buy' portfolio, however, with Bovis Homes given the boot. The cheapest in the sector, Bovis is the value play and is on track to realise nearly 30% of upside, but Johnson can't shake nerves relating to recent profit warnings.

Management has promised to increase the dividend each year, but it's not enough to convince investors to take the plunge, especially as they are already wary of the sector. The shares are downgraded to 'hold'.

[battue2] 04/1/2017 18:54

Trading update 11 jan.

[the_equaliser] 04/1/2017 17:17

Your rise

16:35:07 161.4000 4,153,581 UT 161.3000
16:53:45 160.1368 922,304 NT 160.8000 161.6000

[m4rtinu] 04/1/2017 16:20

"Geddon! Taylor me buye"

[tlobs2] 04/1/2017 16:12

Sit tight and give them nothing...... :-)

[cc2014] 04/1/2017 13:57

This looks very interesting today. Looking at volumes it looks like buyers happy to keep raising price but it isn't bringing out many sellers. Position even more extreme on PSN

[gbh2] 04/1/2017 11:54

We'll be back to +200p by the ex special dividend date.

[mortimer7] 04/1/2017 10:24

Taylor Wimpey "Top Sector Pick" per Deutsche Bank today...

Housebuilders were in demand today after Deutsche Bank said it saw “appealing value” in the sector

"They reiterated a positive stance on the sector and maintained ‘buy’ ratings on Taylor Wimpey PLC, which is its top sector pick, as well as Barratt Developments PLC and Berkeley Group PLC".

(In a note to clients)

[m4rtinu] 04/1/2017 08:29

Is the problem that many potential buyers are unable to save for a deposit, as their rents are so high? The rent is often as high, if not higher than the mortgage repayments. So there is possibly a frustrated demand.

[steeplejack] 04/1/2017 08:14

There's a shortage of housing and there's plenty of mortgage availability.That's good.However,sentiment surrounding the sector is in part likely to reflect a marked fall in housing transactions and a marked slowdown in property prices.London residential asking prices in central locations are probably a good 10% off the top assisted by Osborne's ill conceived hike in stamp duty making the Revenue a net loser.I reckon TW. will continue to perform well but some sort of slowdown seems inevitable.Look at the retail sales figures released today,hardly a confidence booster.That said,I don't think the rating is demanding and the stock has been treated rather churlishly in last few months.Happy to hold.

[tlobs2] 04/1/2017 08:09

A reasonable start to the day. Long may it continue as the reality kicks in that there will be a shortage of houses and plenty of building work for many years to come.

[jugears] 03/1/2017 17:49

Interesting Story & shares up today? Imho any reductions in house prices is built in to TW share price at the moment, I also think that house sales will increase this year , My own order book for the house building market is still increasing & I expect this to be another record year for my company. Think Tanks & the Telegraph sums it up really (Both F-----g useless at predicting) Just more speculation !!! & the market seem to think the same.

[banksy] 22/12/2016 15:25

Lagging behind the other builders again!