Taylor Wimpey Share Discussion Threads

[wfl1970] 31/12/2018 14:44

IMV, That's a fair description of events Donald.

[disneydonald] 31/12/2018 13:04

Tlob. The hastily arranged GM was to correct a typo in resolution 18, which was voted on at the last AGM. At each AGM a bunch of resolutions are put to the shareholders for approval,or otherwise. Resolution 18 was to renew permission for the company to purchase up to 10% of its own shares. This is one of the standard resolutions which are included and voted on every year. At the last AGM, the date for which the authority to purchase was incorrect (typo). It was asking for authority to purchase up to AGM 2018, and not AGM 2019. Someone likely just cut and paste the previous years resolution and did not update properly. The company has no choice but to correct this embarrassing mistake, in line with normal corporate governance procedures

[jugears] 31/12/2018 11:21

marks- thats what happens when you build high end houses concentrated on one particular area.

[marksp2011] 31/12/2018 08:47

There are problems with some of these companies. Looks like Crest is in trouble and the short interest is building. TW probably doesn't have the same issues as Crest and Berk but it impacts the sector

[tlobs2] 31/12/2018 08:38

So why the rushed meeting last week to approve plans to buy back their own shares then Donald?


It's Monday so we will start you off with an easy one........


Oh and kenmitch, the buyback needs to be in profitable growing companies and not basket cases as is often the case. This is a healthy company with lots of spare cash and a huge land bank. But I hear what you are saying ;-)

[disneydonald] 30/12/2018 16:46

There is no share buy back scheme planned.

[kenmitch] 29/12/2018 13:41

tiobs.

A $TRILLION has been spent on buybacks in the US this year. Hasn’t worked wonders for US share prices has it. Worst December since Great Depression and bad year in general.

Same applies here .Buying back shares does not mean a higher share price. If it did it would be a sure fire way to invest successfully. Standard Life Aberdeen have been buying back for months now. Their share price has almost halved since they started buying back.

[dr_smith] 29/12/2018 12:58

WFL..on hope.. funny you should focus on word hope in investor context as I said same testerday to a mate in email:
""hope" is a word I feel awkward about using as a good strategy should be based on probability not hope...though world trade and macro economics is too mind blowing to predict."
Dave

[wfl1970] 29/12/2018 12:24

Is 'Hope' a stratagy, or all there's left to cling on to?

[m4rtinu] 28/12/2018 16:02

Hope you are right.

[tlobs2] 28/12/2018 15:27

I'd say that the market see it as a positive. I look forward to the start of the share buy back scheme and have no doubt that it will have a very positive impact on the share price.

[stewart64] 28/12/2018 15:04

Think the Market is very harsh on building cyclicals tbh. especially as this time around the companies have the balance sheets in order.

Oil and pharmas p/e can go from about 100 to 20. TW is at 6 and no doubt it will be considered a disaster if it blows out to 20 based on today's price, the price would fall first and never get to 20 even though that's good for other sectors.

[m4rtinu] 28/12/2018 14:42

As I said before, the recent Lloyds share buyback was ineffective in supporting share price Unless it is thought it (SP) would have been even worse than it is now. Two fairly similar shares in terms of a barometer for the UK economy. And the barometer is showing stormy weather ahead.

[gbh2] 28/12/2018 12:42

imo the Hedge Funds traders have this by the short and curlies, no amount of buyback is going to have much of an affect on the share price until and IF they decided to walk it back up.

[tlobs2] 28/12/2018 12:35

It means that whenever there is a dip in the price for whatever reason there is the opportunity to potentially buy millions of shares for cancellation on the cheap.

They must be keen to push ahead with this having called the meeting at such short notice .......IMHO

[stewart64] 28/12/2018 11:33

At the end of the day it wont be because these share buybacks are a drop in the ocean. I put it badly, just saying you don't enhance your cash position in the short term by buying your shares to trim the dividend payout. Stating the obvious.

[gbh2] 28/12/2018 11:11

"impairing liquidity"?

Have you seen just how many shares they have in circulation?

[stewart64] 28/12/2018 10:43

I believe the forward dividend is 13.5% based on the live price, 18.3p/135p. Buying back shares will save dividend payouts, but even at 13.5% it is a long term strategy. In the short term you are impairing liquidity. But as you say you have to be confident of future earnings to "throw off cash"

[riley109] 27/12/2018 18:03

The company has nearly 2.3 BILLION shares in issue, a share buy back will mean less dividend will have to be paid which can only strengthen the Company for the future.

The company buys land, builds houses and then sells them, it’s as simple as that. Cash generated from sales is then reinvested into new land and excess funds are returned to investors.

Taylor’s outlook is not as bright today as it has been in previous years as costs are starting to creep up. Management expects operating expenses to rise by 3% to 4% in 2018, following a similar rate of growth in 2017.

However last year, the company was able to offset higher costs by increasing average selling prices by 3.5%, which implies that the firm will be able to do the same again for 2018. According to Hometrack, house price inflation across the UK’s top cities accelerated to 5.2% at the beginning of this year, from 4% a year ago.


Even if Taylor can’t fully pass on higher costs, it’s clear the firm can afford to absorb lower profit margins without being forced to slash its dividend. The group generated an adjusted operating margin of 21.2% last year, which was enough to lift net cash by 40% to £511.8m, even after the distribution of profits to investors.

City analysts certainly seem to believe that the company can keep up its current growth rate. Analysts have pencilled in a net profit of just under £700m for 2018, up 26% year-on-year. Earnings per share are projected to rise to 21.2p, giving a forward P/E of 8.7.
What about the dividend?

So, Taylor is expected to continue to grow in the years ahead, and the company is throwing off cash, which indicates that the dividend yield is safe. It also implies that the distribution should be held at the current level and possibly increased going forward.

With this being the case, Taylor’s current dividend yield of 8.2% looks too good to pass up. There are few (if any) other companies on the market today that offer the same level of income backed up by a cash-rich balance sheet. Indeed, Taylor currently has enough cash to continue with its current dividend policy for a whole year if profits vanish altogether. If the payout is cut by 50%, the company could continue to reward shareholders for a full two years without selling a single house.

[stewart64] 27/12/2018 14:21

Sounds to me like Taylor Wimpey are drowning in liquid cash. They had 600m at opening, the dividend for 2018 was on the cautious side and they have indicated it was well covered by ongoing profit, Thirdly we have a probable switch from land to cash on the balance sheet as the land bank is run down slightly.

Not keen on these buybacks but if the Market has under-estimated TW's value and they are drowning in cash, no choice but to shrink the balance sheet and shares I guess.

Would be reckless to buyback shares if they haven't got cash 'coming out their ears' as they have to have 600m reserved for the 14% 2019 dividend.

It's all lala land yields, Brexit has brought domestic stocks so low.

[tlobs2] 27/12/2018 11:51

"General Meeting at 9:00 am on 28 December 2018, to consider a general authority to make market purchases of the Company's ordinary shares"


So by half nine tomorrow morning there will be a huge brush in the market ready to sweep up millions of these cheap shares ;-)

[marksp2011] 24/12/2018 19:22

Allot..... WTF

[steeplejack] 24/12/2018 18:21

Thank you for your concern,I’m quite well as I observe a further 2.7% fall in the S&P500 during a shortened trading day on Wall Street.

I wish all here a merry Christmas and happy New Year.”Prosperous” has been excluded from the salutation as the S&P registers a 13.7% monthly decline .....the most in any December since 1931!

With Mr Trump providing a steady hand on the tiller,there is little to fear in 2019.

[sikhthetech] 24/12/2018 10:56

Merry Christmas all genuine posters..

[tlobs2] 24/12/2018 08:19

We've not heard from steeplejack yet this morning.

Do you think he survived the weekend? ;-)