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Tuesday newspaper share tips: OneSavings Bank and Wolseley

Tue, 07th Jun 2016 15:48

(ShareCast News) - Business is booming for OneSavings Bank, which has just clocked up a £35m profit after selling a £250m securitisation of pre-crisis mortgages, writes the Financial Times' Lex column.The buy-to-let lender intended to use the dosh to originate more mortgages, and its loan books have swollen by more than a third each year since 2013.And yet, noted the column, shares in OneSavings Bank have lagged Lloyds'. This was true also of other buy-to-let lenders Shawbrook and Aldermore.Lex reckoned valuation could be the reason, observing that the stock trades at a twice-2017 book value, which was rather high for a European bank.It also looked to a list of bearish points, among them increasing purchase taxes, Brexit and further cuts to tax relief of buy-to-let mortgages."Yet lending keeps growing," wrote the column. In April it was up 16% on the year to £18.5bn, according to Council of Mortgage Lenders' estimates.But also Lex contended that these factors would help so-called professional landlords -- those with four properties or more -- who could absorb the higher costs and would want more services, such as setting up tax-efficient corporate structures.Property consultancy thought that the proportion of UK homes rented out privately would rise four percentage points to 22% in the next five years."A share contraction in the property market would hit buy-to-let lenders hard," said Lex."But anyone worried about a housing crash should not own shares in a UK bank."Meantime, The Telegraph's Questor column also dipped into the property-related theme, slapping a "Sell" opinion on the hsares on plumbing supplies business Wolseley.It pointed to a 10% slump in the outfit's shares after a grey third-quarter trading update."There could be more pain to come as slowing growth at the FTSE 100-listed company leaves the shares exposed," contended the column.Wolseley generated most of its revenue and profits in the UK, and warned that industrial markets -- contributing about 14% of the US' £8.3bn revenues -- experienced weaker demand."The company operates the Ferguson brand in the US, where orders have been lower due to a slump in activity from oil and gas-related customers," Questor said.It also pointed the global commodity slowdown, which had put a damper on Wolseley's Canadian and Nordics businesses, and noted the tough trading in Wolseley's home UK market."Here (in the UK), like-for-like revenues were down 0.4%, during the third quarter as repairs and maintenance remain weak. The company will report on a review of UK operations in August."Nevertheless, Wolseley did post 2.8% like-for-like revenue growth."The concern is that the US juggernaut is showing signs of slowing and that leaves the shares trading on 15-times forecast earnings looking exposed," Questor noted."The company reports annual results on September 27, with the market expecting revenue of £14.3bn and pre-tax profits of £860m, giving 246p in earnings per share."The issue for investors was the building supplies business had a track record of being extremely cyclical."Looking back to the previous peak in 2006, the shares fell almost 90pc during the next two years as the slowdown hit. Sell."

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16 Feb 2017 09:53

Panmure initiates coverage of challenger banks

(ShareCast News) - Panmure Gordon initiated coverage on several challenger banks on Thursday, highlighting a preference for specialist lenders as they have avoided direct competition with large UK banks and offer high growth and returns at attractive valuations. The brokerage started Aldermore, OneS

16 Feb 2017 08:41

LONDON MARKET OPEN: Airlines Up As Cobham Suffers From Profit Warning

7 Feb 2017 11:09

Shawbrook appoints Dylan Minto as CFO

(ShareCast News) - Challenger bank Shawbrook Group has appointed Dylan Minto as chief financial officer and executive director with effect from 6 February. The specialist lending and savings bank said Minto's appointment follows an extensive market search for the best candidate following the departu

21 Dec 2016 09:25

BROKER RATINGS SUMMARY: RBC Upgrades Shawbrook To Sector Perform

21 Dec 2016 07:39

RBC Capital ups Shawbrook to 'sector perform', lifts EPS estimates

(ShareCast News) - RBC Capital Markets upgraded challenger bank Shawbrook to 'sector perform' from 'underperform' and lifted the price target to 280p from 210p as it upped its earnings forecasts. The bank noted the stock is off 26% this year versus the sector average off 2%. In addition, it pointed

13 Dec 2016 10:09

Liberum initiates coverage of challenger banks, prefers OneSavings

(ShareCast News) - Liberum initiated coverage of five challenger banks with three 'buy' recommendations and two 'hold' stances. The brokerage started OneSavings Bank, Shawbrook and Aldermore at 'buy' with price targets of 395p, 290p and 245p, respectively. It said OneSavings is making regulatory ch

14 Nov 2016 14:40

Sector movers: Banks lead gains as strategists raise US yield forecasts

(ShareCast News) - Shares in banks and life insurance outfits continued to pace gains as Treasury yields kept moving higher in the States on expectations for a fiscal spending boost under the new Administration, pulling interest rates across the globe up with them. For the most part, analysts app

14 Nov 2016 14:05

FTSE 250 movers: Greencore and banks gain while gold miners fall

(ShareCast News) - The FTSE 250 index was in positive territory, just shy of 17,500, by the late afternoon on Monday. Irish food company Greencore led the risers, gaining on the back of jump in full-year revenue and earnings, a hike in its dividend and the proposed acquisition of Peacock Foods for a

3 Nov 2016 17:55

CORRECT: LONDON MARKET CLOSE

3 Nov 2016 16:14

Director dealings: Shawbrook stand-in CFO likes what he sees

(ShareCast News) - Shawbrook Group's stand-in chief financial officer, Dylan Minto, snapped up shares in the challenger bank on Thursday after it posted a strong set of third quarter results. Minto, who was director of strategy before his temporary promotion, bought 15,000 shares at 237.74p and 5,00

3 Nov 2016 08:26

Shawbrook posts solid quarter with 'minimal' impact from Brexit

(ShareCast News) - Shawbrook Group issued its interim management statement for the nine months to 30 September on Thursday, reporting a stable net interest margin of 5.6%, with continued tailwinds expected from deposit book repricing following the Bank of England base rate cut in August 2016. The FT

26 Oct 2016 09:12

Banks' mortgage approvals rebound from low, BBA data shows

(ShareCast News) - Mortgage approvals from high street banks rebounded slightly in September, according to data from high street banks, after hitting a 19-month low in August. The British Bankers' Association (BBA) revealed mortgage approval numbers in September of 38,252, which was up from 37,241 i

25 Oct 2016 11:46

Credit Suisse sees rising risks for challengers banks Aldermore, Shawbrook

(ShareCast News) - OneSavings Bank received an upgrade but Aldermore and Shawbrook were downgraded by Credit Suisse as it warned the risks facing the UK's challenger banks were "becoming harder to ignore" heading into 2017. Following solid share price recoveries in recent months, the risk-reward for

25 Oct 2016 07:15

LONDON BRIEFING: Pound And Shares Firm Ahead Of UK Airport Decision

23 Sep 2016 08:34

RBC ups targets on specialty lenders due to UK economic resilience

(ShareCast News) - Analysts at RBC revised their price targets for UK challenger banks higher as a result of the resilience shown thus far by the economy and the support provided by the Bank of England. The broker also revised its forecasts higher for Aldermore,Close Brothers and Shawbrook. "While

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Tuesday newspaper share tips: OneSavings Bank and Wolseley

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