Watkin Jones Share Discussion Threads

[rivaldo] 09/6/2016 14:24

We're not far off this year end of 30th September - it's only 4 months away. Others have mooted that WJG may beat this year's forecasts given today's numbers.

Meanwhile, the market will start to look to next year's forecast of 13.4p EPS. Even a P/E of 10 would give decent upside from here.

But the forecast dividend for next year is a whopping 6.28p, so this will encourage income funds to buy in too. It's possible to see say 145p-150p on that basis imo without any upgrades or earnings-enhancing contracts adding fuel to the fire.

[discodave4] 09/6/2016 13:03

Tempted.Just be nice to get a feel as to H2 weighting/seasonality. Had a look at UTG but FY is calender year, taken a look at TEF (also adopting forward funding model) and March-Sept is about double the eps, trouble is they are a pure house builder.Don't generally go by what house brokers/Nomad's say (Zeus and Peel Hunt). If eps is 12p then with a PE of 10, not much potential here........but then again!.Thoughts? (Naturally no advice taken, Dyor, etc etc).DD

[invisage] 09/6/2016 09:36

Joined you guys here. Looking good. Should get further coverage from tip sheets etc post results so would expect more buying on the back of this.

[its the oxman] 09/6/2016 09:33

Results all good. Expecting further steady progress once market steadies / Brexit is out other way.

[jonwig] 09/6/2016 09:28

Alpha - thanks, but I was thinking of the weather as I gather they take phase payments rather than a single end payment. Though there's certainly going to be a push for delivery to the owner by September. Two factors, then.

Incidentally, there's a huge volume of buying this morning, within the quoted spread.

[alphabeta4] 09/6/2016 08:57

jonwig 9 Jun'16 - 07:22 - 95 of 103 0 0

I can't find an explicit statement anywhere which confirms seasonality (ie. H2 stronger than H1, for obvious reasons).

I would suspect this is due to the end of the second half corresponding with the start of the academic year. Some customers are going to want to have their blocks built to coincide with this to save them sat idle. As you mention it can be seen in last year's figures.

[someuwin] 09/6/2016 08:51

Peel Hunt says BUY with 130p target.

[ramridge] 09/6/2016 08:34

Excellent results.
It looks as if they will at least meet broker forecast of 12.1p eps.
On that basis, forward PE is 9.2 And on a cash adjusted basis, it comes down to 8.3 . The company has no long term debt.

Bargain. Topped up this morning.
please DYOR

[markie7] 09/6/2016 08:11

All looks good here.....

[rivaldo] 09/6/2016 08:10

Excellent H1 results indeed - WJG look set to meet and perhaps beat expectations of 12.12p EPS for the year given the momentum in the business, acquisitions etc.

The 4p or so dividend will come in handy too.

Plus WJG are healthily financed, with £15m net cash beating IPO guidance of £10m.

With the excellent visibility and pipeline things are looking good.

[nimbo1] 09/6/2016 08:07

I increased here by 25% on the back of the interims - nice to own a solid.

Jon wig ref your target price it seems entirely possible. Simon Thompson agrees with you and no doubt will be reiterating as per the norm after results later this week.

[nurdin] 09/6/2016 08:04

Joined you guys..impressive interims.

[jonwig] 09/6/2016 07:25

abarclay - See posts from #47 - might help?

[abarclay] 09/6/2016 07:23

Why do they own aeroplanes? Are they running these at shareholders expense for benefit of directors ?? Doesn't look good

I want them to sell the planes before I invest and other similar milking mechanisms removed

[jonwig] 09/6/2016 07:22

I can't find an explicit statement anywhere which confirms seasonality (ie. H2 stronger than H1, for obvious reasons).

The PL account shows a strong effect for 2015, which suggests to me that the FY outcome could be about 15p adjusted eps making the forward PER under 8x.
I'd have expected a compny such as this , with good earnings visibility and net cash to be rated at 10x or more.

Does this look reasonable? A share price of 150p? I'm not normally given to over-enthusiasm.

[someuwin] 09/6/2016 07:19

Excellent results.

[nw99] 09/6/2016 07:08

Commenting on the results, Mark Watkin Jones, Chief Executive Officer of Watkin Jones plc, said: "Following on from our successful admission to AIM in March this year, we are delighted to report such a strong maiden set of half year results today. Our student accommodation development business remains positively underpinned by the fundamentals of the student accommodation market and the forward sale model provides us with excellent visibility as to future earnings and cash flow. The current student accommodation pipeline of 31 development sites underpins the business outlook to FY 2018, with 16 of the 17 developments for delivery by the end of FY 2017 already forward sold. We are at advanced positions regarding the acquisition of a number of site opportunities that will be for delivery in FY 2019 and beyond.

[someuwin] 06/6/2016 15:55

Andrew Jones ‏@andrewjoness88 · Jun 3

@Watkin_Jones Morfa Road, Swansea taking shape #WJG

[davidosh] 06/6/2016 13:59

The results are on Thursday and also to remind you all that Watkin Jones will be presenting at my next Mello dinner event in Beckenham....However for various reasons including the Euro2016 football tournament and the referendum I have held off their appearance until the July Mello which is currently scheduled for Wednesday 13th July as WJG could not make the Monday option.

[2vdm] 06/6/2016 12:40

Results due Thursday I believe.

[nimbo1] 03/6/2016 09:44

Hi Jonwig, yes it is a sector everyone is scrabbling to get into at the moment. The pension funds are all over it as they are all desperate to have money at work which can give certain 5% income returns. If W Jones can be of service in this space they will do very well over the coming years.

[jonwig] 03/6/2016 08:24

In post #24 there's a link to a long IC article which describes WJG's tapping the private rented sector - "build to rent".

I've just noticed a Telegraph Questor article (1 June) tipping Telford Homes for just the same reason. Relevant snippet:

Telford Homes said yesterday that a “significant” move into private rented sector housing had brought “exceptional capital returns” and that that type of scheme could soon form a larger part of its business.

The private rented sector has only recently become a mainstream investment class, but in the past few years has attracted institutional interest for the first time because of its potential for income generation. Telford Homes is taking advantage of this trend by offering to build homes and then sell them on to institutions who want long-term income from property assets.

Yesterday, it agreed a deal to sell a private rented sector development in Bow, east London, to M&G Real Estate for £69.3m. The development, known as Carmen Street, will be ready for occupation by September 2019.

Telford Homes chief executive Jon Di-Stefano said the company would be keen to formalise its relationships with investors such as M&G Real Estate in the future, as the model enables Telford Homes to grow without taking on any debt and limiting the need for additional capital.

Added to that, by increasing its exposure to private rented sector development, Telford Homes can de-risk its long-term development pipeline, expand forward sales and provide a greater indication of future revenues.

The private rented sector is also seen as counter-cyclical to the wider housing market, meaning Telford Homes could be better placed when prices next turn.

This looks to be exactly the same sort of thing. (I don't hold that company.)

[2vdm] 31/5/2016 16:06

Thanks rivaldo. Backs up other views and am looking fwd to watching steady progress. Like the business model too.

[jonwig] 31/5/2016 12:41

I've added major shareholdings to the header. Free float only 50% (family 50%).