Just in case anyone interested and hadnt seen this henry boot rns this morning.Henry Boot announces that its land promotion and planning business, Hallam Land (Hallam), has completed the sale of 632 residential plots at Pickford Gate, Coventry to national housebuilder Vistry Group PLC ('Vistry'). The sale resulted in an ungeared internal rate of return for Henry Boot of 28% p.a. |
That is normal procedure with many buybacks...art of buybacks..buy highs... |
Instead of building houses the company is buying its own shares at prices that are now falling. It is depleting its cash reserves. |
Catching that falling knife is always a difficult one. All HBs are being battered, most at 3 year lows but they will bottom out. This is a great stock for all traders as volatility reigns. |
Absolute shtshow but when to av down is the ?? |
ST,Everyone has an agenda, especially the IBs who will be knocking whilst buying the stock ! No getting away from the shoite news BUT memories are short when it comes to trading. If there's positive news on 15/1, this will bounce as shorts will close regardless of management failures. If there's more bad news, there has to be management changes and they will be on the predator hit list, they'll be on it now. I'll continue to buy down here and reappraise next week :) |
So 500p getting closer...with building companies over run on costs is normal... |
 UBS has lowered its price target for Vistry Group PLC (LSE:VTY) to 495p from 605p, maintaining a sell rating after the company issued its third profit warning in as many months.
The cut reflects concerns about Vistry’s financial outlook and its ability to recover amid rapidly falling profits and rising debt levels.
The December profit warning revealed that 2024 pre-tax profits are now expected to be £250m, down from £300m.
Vistry attributed the decline to weaker market conditions, delays in transactions, and a decision to avoid offering steep discounts to secure bulk sales.
UBS sees these issues as troubling signs of deteriorating trading conditions and reduced customer demand, particularly as they surfaced with little time left in the financial year.
The state of Vistry’s balance sheet has also raised some alarm with the Swiss bank.
Net debt at year-end is now expected to reach £200m, significantly higher than the previous forecast of £50-60m.
UBS estimates average monthly net debt for 2024 could climb to £550m, with total adjusted debt, including provisions and joint venture obligations, reaching £1.8bn.
This would represent leverage of 5.3 times earnings before interest, taxes, depreciation, and amortisation—a level UBS believes could force Vistry to prioritise debt reduction at the expense of profitability.
UBS highlights several key risks, including whether the balance sheet is adequately funded given the steep profit decline, what a realistic profit trajectory for 2025 might look like, and how quickly the company can recover.
While the upcoming trading update on January 15 may offer some clarity, the outlook remains uncertain.
The new price target reflects UBS’s lowered expectations for earnings per share, with the valuation based on discounted cash flow analysis.
The bank has revised its assumptions, reducing the expected long-term return on capital employed from 17% to 15.5%, reflecting diminished confidence in Vistry’s ability to rebound. |
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It's entirely possible the 24/12 is the end of it. I wouldn't believe it until I see several updates. Whether these are worth a punt at current levels is another matter.
"If the balance sheet was going to be weakened by further income erosion in 25, the buy back scheme would’ve been pulled"
Not necessarily. They announced the black hole 8th Oct, suggesting it's only a tiny part of their entire business, BBs weren't pulled.
From 8th Oct rns:
"The Group has recently become aware that within one of its six divisions, the South Division, the total full-life cost projections to complete 9 out of its 46 developments, including some large-scale schemes, have been understated by c. 10% of the total build costs. To add further context to the 9 developments in question, it is important to note that the Group as a whole has around 300 developments.
The estimated one-off impact of adjusting for the revised development cost assumptions reduces the Board's expectations for adjusted profit before tax for FY24 by c. £80m, for FY25 by c. £30m, and FY26 by c. £5m. The reduction in expectations in these three years relates to overall cost estimates across the full life of the developments. As a result, the Board now expects Group adjusted profit before tax in FY24 to be c. £350m.
We believe the issues are confined to the South Division and changes to the management team in the division are underway. We are commencing an independent review to fully ascertain the causes." |
ST, I have a different opinion as I believe that rhe kitchen sink has been thrown in. As posted, I believe if the 24/12 update was the end of it so that they can spin out as many positives come update next week. If the balance sheet was going to be weakened by further income erosion in 25, the buy back scheme would've been pulled, it hasn't so I see that as a positive sign. 5 more months at £9m a month when debt forecast is £200m, to continue would be reckless imo. I'm fortunate that I've not suffered the losses that some have had the misfortune experience and I'm happy to kiss up in volume down here. They're an acquisition target too but I believe the Vistry update will be better than expected. If it isn't, I will reappraise following TU and analyst call . |
prob with partnership contracts is that while they are nice big chunky fees and you can plan against them (buybacks), the issue is that you are selling to professionals that understand the mkt and how to operate in it (any issues with the properties will not be swept under the carpet). its easier to push singles onto john smith and in a rising mkt you get that benefit too. both have their advantages and disadvantages but with partnerships while in theory you escape the boom bust, you have to be on the ball otherwise your partners will eat your wafer thin margins. |
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"Yet they continue to hold in buy backs. Net debt forecast at 200m for FY24 so why continue ? "
sikhthetech - 08 Nov 2024 - 12:13:34 - 1739 of 2055 Vistry Group
I've seen this kind of reaction many times...
As per my assertions...Buy backs, NAV, Broker notes, TA, dividends etc wouldn't stop a share from crashing.
What matters is company/sector, economic/political newsflow and the direction they are heading.
Didn't Greg sell all his holdings held via Baker Estates? That was your red flag.
I wouldn't touch this atm. I'm still negative on HBs. |
Bigjock36: "Call transcript confirmed no further issues were highlighted"
A few were saying and thinking the same before the 3rd Profit Warning.
Then the Christmas present knocked on the door.
The only final positive outcome is the resignation of both CEO and CFO and the LAST skeleton taken out of the cupboard once for all - if any -.
This is when the market and investors would feel confident and comfortable. |
Yet they continue to hold in buy backs. Net debt forecast at 200m for FY24 so why continue ? Not long to find out. |
So there's a sudden realisation that some of their proposed developments are no longer viable and these will not proceed any further.
The question to ask is, what has changed in the interim to reach this conclusion.
What about the recent partnership contracts signed where work is already under way..will everything be hunky dory with these..? |
It'll take months, if not years to regain trust in the current management. It'll take several updates to establish they haven't anything else.
The CEO should have resigned when the blackhole was discovered, 4 months ago.
The shares were around 1000p when I posted:
sikhthetech - 08 Oct 2024 - 12:57:14 - 1552 of 1620
They usually do find more. Seen it so many times. Starts with 1 little find and escalates.
They say RECENTLY become aware, so there's likely to be more investigation and then they'll say something like 'further investigation reveals more '...
"The Group has recently become aware that within one of its six divisions" |
What is with all the Braindead posts on here and lse tonight Call transcript confirmed no further issues were highlighted Hopefully 2025 is the start of the business moving forward again |
fuji99, thanks for your reply. Again, I agree that Vistry management appears to have lapsed on Due diligence on the takeover of their counterparts, especially with regard to countrywide, as this is where the trouble started in their south division. The question now is, have they cleaned out, or are there more skeletons to be revealed in the closets? |
Didn't take long for the pressure to start before next update, nightmare is spot on fuji99, then again it will be tough for other builders also, from their current market cap there is along way they can fall and if you feed in some miss management that applies here, that only amplifies it, bit of a perfect storm. |
Svend2: Agree the TU of 15 Jan. will be important but difficult to digest and believe whatever it brings whether positive or negative due to past contradictions.
The market hates uncertainty and doubts as management unreliability demonstrated in the past.
So to restablish any credibility it'll take at least a few quarters to demonstrate that management statements are accurate and can be trusted.
Until then, holding such a share will be a nightmare for any PI. |
33 mins in .. |
fuji99 I concur with your summary only time will tell if the list is not causing further water intake into the ship's hull following the 3 PW. What a sad end to 2024 The TU on the 15 Jan is likely to be a fireworks event my guess is the big guns (institutions) are all eager to line up and aim some tough questions for Mr Greg Vistry 😉 |
Sikhthetech: Since following this stock, I definitely concluded that your logic makes sens.
Many, myself included, ignored the red flags.
Someone even believed they finally told the full truth before the 3rd PW.
As we stand, management has lost any credibility as they transformed a gem of a share into an unpredictable time bomb. |
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