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Yet another RNS.. the Chariman, Bill Shannon, in for yet another 5,000 share today, adding to his 5,000 yesterday at £2.93! Relentless buying amongst the directors would suggest this is now massively undervalued.
Two more director buys flooding through now- if this isn't making a bold statement to the market what is?! This time the Chairman has purchased 5,000 shares, and the husband of another director has purchase over 11,000 shares.. The entire board and their families now seem to think this is significantly undervalued given the relentless director buying.
Down nearly 20% since reporting a good set of results, this is a good company imo.
C of 4 looks almost complete with just minor 4 and 5 to come, with support between top of wave 1 of higher degree, August 2009 high and the 50% retracement of the whole advance from the March 2009 Lows and the August 2015 highs at around 281. Again the smart money looks to be taking advantage of this wave 4 of higher degree, before a wave 5 of higher degree takes the SP back above the August 2015 highs.
Agreed! Mr Mully certainly seems to be enjoying this buying opportunity, just noticed yet another RNS for another transaction he made yesterday- yet another buy of 10,000 shares at £3. He bough 20,000 shares alone yesterday! I wonder if now we have dipped below £3 he will continue loading his boots?!
Sensational newspaper headlines are the share bargain hunters' best friend. As an ex-journo I should know. It's a simple case of accentuating the negative rather than the positive which, very often, is contained within the same story, usually buried in the final paragraphs. GLA.
http://www.cityam.com/223936/cost-luxury-homes-nine-elms-are-being-slashed-bargain-prices http://residential.jll.co.uk/en-GB/new-residential-thinking-home/research/jll-central-london-forecasts-restatement.aspx When you get headlines like these and New Covent Garden represents a big sliceof the value of SMP which has been rerated on an updated valuation of this site since the grant of planning you can see why many investors hav e run for cover but as one door closes another ones opens ! Until SMP announce some good news at Nine Elms here which I am confident they will its hard to see the trend reversing .Blame the Malaysian and Chinese Developers!!
A near £2.00 decline since the highs last August has left the shares trading at a very discounted 25% to net asset value, and a bearish consensus in place. All par for the course for a fourth wave of higher degree which is alternating with a wave 2 in a near perfect way. From the March 2009 lows the SP advanced in five waves to a high at around 268p in August 2009. The SP then declined over 27 months to a low in November 2011 at 100.50p, a three part pedestrian decline with a large a wave, and a small b and c wave. The decline was larger in terms of time than price. The impulsive rally that followed can be labelled as a wave 3 of higher degree and can be broken down into five waves, with a peak in August 2015 at around the 500.00p. The decline from the August peak has been sharp and impulsive and has retraced 50% of the advance from the bottom of wave 2 (November 11 low), and can be labelled as a wave 4 of higher degree of this bull move from the March 2009 lows. The degree of alteration between wave 2 and wave 4 is almost perfect to date and providing wave 4 does not overlap wave 1 in any way then the long term bullish count remains in play. This wave 4 is currently 7 months old and five wave decline is already clearly visible and nearly complete, a sign that a low may be close at hand. Perhaps the smart money senses this and are thankful for the opportunity this wave 4 is providing.
299 and JPM/C say 450. This is utter lunacy and when will it end? SMP now down over £250m on market capitalisation. Great results, stable growth, long term vision, quality management. 499 to 299 is ludicrous. This company does not deserve this ridiculous rating Makes one wonder if there are not 'dark forces at work'. Maybe even a formal investigation from FCA? Stay with SMP Time to buy and buy big?
When JLL who are responsible for marketing many schemes for various developer are rresponsibly talking down the market by sugesting prices fall minus 3% in Central london across the board and investors running for cover which is an ill defined stretch its not surprising that everybody is heading for the escape hatch Stan the Man must be quaking in his grave that a company which has quietly made its dough developing large tracts of land in the regions could be stymied by a scheme in Central London which dwarfs all the good work elsewhere The negativity I hope is is overplayed SMP certainly didnt work their original appraisals on the basis of outlanish figures £1m for an apatment tajht the Chines andMalaysian developers locally have Hopefully the current SP has now dipped below 300p this should put some line of resistance The good thing about Nine Elms is asuts aseries of sites so can be mrkete dindependently It wouldnt half surpise if they get large chunk away to an IPRS opearter Unfortuantely we will have to hold steady I dont think any amount of regional good news like the sale of the retail at Longbridge is going to help push the SP ahead Nine Elms seems to be the equivalent of Constitution Hill to Brums, Jewellery Quarter
And a second buy by Mr Mully today at £3.05! Taking his monthly purchase up to 30,000 shares- he certainly seems confident. I wonder if he will keep filling his boots if this falls further?
Richard Mully certainly seems to think it's good value, he has bought yet another chunk today.. that is nearly 25,000 shares he has purchased over the past month! Very reassuring IMO, given his credentials in real estate investment: https://uk.linkedin.com/in/richardmully
Rather than us attempting tosecond guess the situation-a company statement-ideally before AGM in a fortnight- should reassure market that the 9 Elms panic is vastly overblown and hence stock gross oversold as we all, believe.
Hi Rapper, We could estimate any potential write down by calculating the proportion of SMP's entire portfolio the 9 elms development makes up on the Net Asset Value, and then we could estimate the potential loss on the development and the ultimate write down on the NAV and establish the trading metrics after these have impacted on the balanced sheet and P&L. Unfortunately I don't have the time to calculate these figures in detail at present as I am very busy, but maybe someone else can chip in with some figures if they know them to hand. Ultimately the discount has arisen because of the concerns over the cooling of the 9 elms development, which isn't due for completion until well into the future. With several risks on the horizon such as less interest from abroad in this area and a clamp down on BTL through the increases in stamp duty, prices are likely to cool but I think the market has factored in considerably more downside than will ultimately materialize, hence why I have just bought back in here. I think the directors, who will know the above financial intricacies in detail, recognize this too and have thus been buying in at even higher levels than today. At current prices I see any further downside as limited, and see far more potential upside medium term. Interested to hear Sain and others thoughts too.
hi both the sp is in freefall wholly or at least mostly onthe doubts of the viability of the residential part of the 9 elms development. with a discount of 25 plus to net asset value what % reduction in nav would you guess if the markets worst fears were realised on this issue. In other words would the sp still look silly cheap after the worst likely writedown? This is probably as stupid a question as "how long is a piece of string" but i would still like to hear your current views as such a paper loss in such a short space of time is highly alarming and yes i have noticed that the directors have been putting their own money where their mouth is.
A long time since we have communicated on here whats your current thinking on SMP thinking of getting in...what are the negatives at the moment worries & concerns about the business....many thanks...
Indeed, I bought back in here today at £3.12. I think these comments RE: 9 Elms from Pete Redfern must be partly to blame for the impact here: http://www.standard.co.uk/business/taylor-wimpey-boss-don-t-bank-on-battersea-flats-a3192351.html That being said, St Modwen has a relatively well diversified portfolio and a discount of 25% to NAV, even if some write downs are required, looks unjustified. We can take some confidence from the recent director buys. Another small part of my decision to buy back in today was the fact that this goes ex dividend on Thursday to the tune of 3.85p. Not much but should perhaps provide a little support tomorrow.
Irrational markets in my experience of over 50 years make for the most rewarding investments. To say that a discount to assets of around 25% on a p/e of around 3, having just announced a record year is irrational is, in my view, an understatement., given the superb track record of this management. I have therefore been happy to add to my substantial holding
Sorry wrong place
Still think John Morgan,s Morgan Sindall would be an ideal fit for TEF.John is a Chartered Surveyor and came from an agents dealing background together with Jack LovellThey then moved into office fit out , and general construction and now have a strong urban regenration arm and also social housing provide, cradle to grave
Some good news needed to stop the rot otherwise its going to slip below 300p Perhaps a mammoth IPRs deal on on e of the Nine Elms sites under SMP & Vinci control will do the trick Telford Homes have just done one across the water for £67m so a £200m little belter might just be enough to put the wheels back on the bike
10k share purchase by Richard Mully on Friday! Interestingly Mr Mully was previously head of real estate investment at the bankers trust and a managing partner at Soros real estate partners. He obviously knows the real estate sector very well then, and seems positive on St Modwen, despite the concerns over 9 Elms and wider macroeconomic fears, at these levels having doubled his holding to 40k shares over the last two weeks.
Cant disagree that the SP peformance of TEF has been disappointing but very happy with what the company is doingThe only point I made is that the SP performance of Bovis and St Mod( great companiesas well) has been similarly poor too and that switching last summer from TEF to these companies which as you suggested wouldnt have been the wisest move Youw ere extremrly bullish about both comapnies seeing the £5 and £10 barriers vaulkted and with clear water left trailing behind You werent suggesting to swap into Gleesons which of course would have been extremely fortuitous Hers hoping for a bit of a rally here today Hows the team doing
Ironic how following your post your beloved TEF tanks a colossal 6%! I merely pointed out TEF looked expensive relative to peers, which it still does. I then bench marked it against Redrow, Gleeson and SMP all whom were trading at £4.50 at the time. Lets looks where they are now: Gleeson £5.80 Redrow £4.05 SMP £3.36 TEF £3.37 As you can see TEF and SMP have performed appallingly, crashing 25%! Gleeson has rocketed nearly 30% and Redrow sits between them having lost just over 10%. When we did the comparison you said if you had a theoretical 100k to invest you'd put it all in TEF. Had you selected a composite bundle of equal weighting of the above three the bundle would be worth an average of £4.40. That is a mere 2.2% loss compared to the whopping 25% loss you have instead suffered! You seem bitter that you have selected the worst performing share in the sector and now need to take your frustration out on others! Ofcourse, with hindsight we would have just put everything and the kitchen sink on Gleeson, but as it goes a composite bundle was by far the better option than gambling everything on TEF as you have done! Hedgefunds aren't shorting the entire sector, they are shorting Berkeley specifically as a proxy for high end London builds over fears foreign demand for is dropping off; demand in the regions is still extremely strong and builders would actually prefer a lower level of house price growth to create a more stable operating environment free from bubbles- any fear of a bubble will put people buying off until period 2, and that will create a self fulfilling prophecy and a property price correction. Better would be very slow house price inflation, just enough to offset build cost inflation. The top end of the London property market isn't linked at all closely with domestic demand across the country from owner occupiers, completely different kettle of fish.
As you post always encouraging to see Director buys eyeing up a value opportunity especially those with limited shareholding themselves.You have pointed out in your post on Berkeley th ecurrent retracing in the sector is due to a number of the big beasts have calling time on the market and have shorted the residential houesbuilders and proeprty companies associated whose finacial health is linked to the continuing success of the London Residential Market which they fear most On the bais of a falllng tide lowering all boats I do think that you are suffering alittle from confirmation bias by thinking you have selcted individual companies in the sector which are immune You were quick to point out that you foresawt he early retrace of TEF last June promoting both Bovis and St Mod as the companies to switch into Looking back in hindsight this would have been a foolhardy decision the drop off in SP price has been entirely similar except for the fact TEF fell In June and SMP quickly followed in August