Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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Had a note at the weekend essentially picking out Bovis from the rest and quote " Buying Bovis shares is like buying £5 note for £4 !! and that the current levels it is cheaper to buy the shares than the asset of the land they own, without any upside once houses have been built!! ( ie still well below NAV)
Hi blackpuss, it's been a while. I bought some also last week at 699p atb vog still going from strength to strength.
agreed.... i bought in recently after the brexit vote.. panic has been way overdone imho. money for old rope buying at these levels longer term. gla
When property funds reduce their value significantly it is partly due to loss of confidence post Brexit but more importantly that floor space has exceeded demand for some time effecting rental values going forward particularly in parts of London and the South East. Unfortunately, coupled to Osborne's threats that house prices would drop by between 10 and 18% the Property funds devaluation has also fed over into the housebuilding share prices. The damage is serious but one might ask oneself is Bovis now worth less than 3 years ago when its profits are holding up and in any event will be very much larger now irrespective of Brexit or otherwise and finally how many houses have been built since Brexit 2 weeks ago to accommodate the 40,000 new arrivals since then?. The fundamentals of this share currently represent outstanding value.
I agree, it's 100% sentiment, maybe 90% and the other 10% being how the company was run. But looking at where the majority of Bovis' sales are the demand isn't going away any time soon, even if there is a migration away of some affluent EU nationals. I'm fully invested at the minute but would consider more at this price, especially if the divi is maintained
If the SP was discounted to around 1034 5 weeks ago and the trading statement issued ... the current SP does not stack... all about sentiment., The really big builders have over extended a tad and had a premium pricing .. this is a quality stock being well managed.. paper loss at present but holding for the next 2-3 years anyway as the housing demand is very high. Even a house price correction will hardly dampen building as there is an overwhelming need for more houses, In the village where I live (W. Mids) a new estate of circa 100 houses was virtually sold off paper at ridiculous valuations and now there are plans for some more. Everywhere I drive I see new estates and buildings .. its no where near enough. Banks with large overseas operations being hammered a bit, but the UK side is strong and remains so after the BOE mandating large capital reserves. Aside from the ever growing debt pile (government spending more than it gets), we are as a country in a decent place ... only have to look at the shambles in Italy, Greece and Spain to see what is coming over there
Strong update today, unusually positive tone for Ritchie! Maybe he's finally learning.
Interesting to consider, the last time this share was £6.20 was January 2013. Cast your mind back to that date, can anyone remember the market conditions back then? I can.. Help to Buy had not even been announced, and there was relative illiquidity in the financial sector and mortgage availability remained the main constraint. So with Help to Buy still in place, strong mortgage availability and a financial system that remains fully intact ask yourself if the current price is justifiable? GIven the evidence, I don't think so and if not in the short term, over the longer term (2-3 years) people buying at these levels will be rewarded IMO. Currently this trades on a big discount to Net Assets at 0.87* historical Dec 2015 book value. Even if this is IMO the worst run builder in the sector, that is currently not justifiable. Thinking about buying a few here but I'm put off by the terrible management team- given their inability to manage this business well over the boom years, who's to say they can manage the business well if we are about to enter a dip? For me this is one of the reasons why Bovis is one of the only builders to trade at a discount to Net Assets so far (the other is Bdev).
Sorry meant to post on Bdev! But Bovis does indeed look cheap on just 0.9x book value!
I am very tempted to buy a few Bdev at current levels. Results for the year to June are out in Sept and forecasts estimate the current book value is currently 385p. Bdev is thus trading on a discount to NAV on a p/b multiple of just 0.91x! To put this into perspective, TW. trades at 1.4x NAV and PSN 1.7x. The only other builder trading at a discount is Bovis at 0.9x. To me Bdev looks too cheap at these levels, and even with such uncertainty at the moment, is surely an excellent medium term buy at these levels with limited downside unless property prices really do start to fall which is currently hard to see with such strong mortgage availability.
When the media hype stops, certain shares will be seen to have been an absolute bargain.When McArthy and Stone report they are on track to meet this year's targets, and through to 2019 although Brexit may delay some completions it gets reported " that Mc And S issue warning !" Then Goldman Sachs say builders will be hit and knock 725p off the target price for Bovis you wonder which boy scribblers they use to dream up a scenario knocking companies such as Bovis by a factor of 50%.. Obviously Osborne's nonsensical predictions of 10 to 18% reduction in house prices must weigh heavily on some but how was it arrive at. Does he and the G Sachs "experts" believe there will be such a massive drop off in demand when overseas investors find our property cheaper whilst sterling is depressed? Do they think that all the tens of thousands waiting to get on the housing ladder will disappear. Do they think interest rates will go up when the consensus is the reverse. That the bank of mum and dad will cease to fund starter homes? Unless the law of supply and demand ceases because of Brexit and /or builders suddenly triple their output when resources are already stretched in terms of available skilled labour the only way that house prices will fall is by self fulfilling prophesies from Chancellors and others with vested interest in retaining the doom and gloom scenario to push for another referendum. In the meantime Bovis under £8.00 is an absolute streal
I think this one is ripe for a rally once it settles down a bit, so I've accumulated more at this price.
I was wondering the same, I thought it was a bargain price before and now in theory it's a steal. But does it have lower to go and what is the SP isn't just sentiment, it's a reflection of future performance? Who knows. It's the same story with one of my others, St Modwen. Let's hope a short term problem doesn't become a long term disaster
Are we really worth 40 percent plus less than we were on Thursday? Of course we aren't. Total and complete madness any financial meltdown is a self full filling phrophecy and has nothing to do with Brexit. Do I buy more or has this further to go?
You are so right and if town planners would do govt wants and get their collective fingers out then builders could increase output . And bvs offers best value in the sector but investors have lost confidence in the management . Needs some institutions to shake up the board . Or a takeover to release value
either way I would think .. country needs more housing
A no to leave vote will surely be of benefit for this share?
Supply demand imbalance still favours uk house builders especially in southern england.
to many issues going on with house builders at Mo 1EU referendum 2buy to let 3house prices to cool off 1london prices to start to drop markets don't like uncertainty all builders had it good last year
I thought I had missed something .. re went over the financial report .. nothing really jumps out other that the company lags a bit behind in ROCE .. but debt coming down, good throughput, decent projects and plenty of margin ... just don't get why its down from 1200 in the middle of last year (that was a tad overvalued though)
lots of mileage in this stock to come and Goldman Sachs just upgraded
Down because has gone ex div today to the tune of 26.5p per share. Will be paid towards the end of May.
3% down
The SP is a bit stagnant and undervalued to ratings, but the dividend keeps performing. One to hang on to for a longer run.