Member Info for cyberduck

Should have said... >Would be a good deal for all concerned at £5.50 per share Perhaps not. If you take the view that the share price will double over 4 years (as the size of the business doubles) then you've got to find another safe way to grow your £5.50 to £8.

>Would be a good deal for all concerned at £5.50 per share !!! Perhaps not. If you take the view that the share price will double over 4 years (as the size of the business doubles) then you've got to find another safe way to grow your £5.50 to £8.

Sain, Thanks for the info. I now realise the way I was thinking was too simplistic. I was hoping to get a relatively simple approximation of the increase in profits from 2019 to 2020 and possibly 2020 to 2021 by looking at the developments started in 2016 and 2017. Having read the 2017 annual report again it's clearly more complicated than that. The margins on the BTR developments are about half of the traditional developments and I was surprised to see that when a property is forward sold the payment is up front while with the BTR developments the payments are staged (and I think the profit either comes at the end or is evenly spread) I, like Strictly, find the broker estimates for 2020 disappointing. I do realise that TEF only have a relatively small number of developments and with them being 3 years the results will be lumpy so I'm trying to get a better overall picture of the underlying growth as well as my own estimates for yearly profits. However it's proving more complicated than I thought.

Sain, If TEF are going to enter into deals like the GreyStar one where GreyStar are paying for the land and funding the development then what do you think they are they going to do with all the money piling in from their other developments? If they buy land, are they not exposing themselves to the property market? Do you have a handle on the number of units being currently developed and building completion dates?

Strictly, I did see your post. Yes, I don't have the experience to say whether estimates are on the conservative side or not but did see that Steve Morgan estimates 77p EPS for 2019 at the interim stage back in February. So with hindsight that suggests he was being conservative back then. Of course the Analysts predicting 2020 eps of 57p for TEF are probably way out too.

Christian, that post is from a competitor. The comments on PIE are completely biased. The truth is somewhere inbetween. Your points about the USA are convincing but there are two nagging doubts i) there are already US online companies and ii) PB raised £50m from institutional investors for the US expansion. I can't see them bot doing their research, but then again you never know :)

At current prices, both TEF & RDW trading at around 6.9 earnings estimates for 2020. In the case of RDW the estimate is from the company whereas 57p earnings for TEF comes from Barclays Stockbrokers (3 brokers).

Still trading at less than 10 times current earnings. Advised earnings of 95p and div of 32p for 2020. Why is this sector so unfashionable? We've had BWY, PSN and RDW. TEF next to move?

"Overall housing transactions in the UK have reduced as a consequence of the political uncertainty and increasing cost of moving home, particularly Stamp Duty which, over the last seven years, has increasingly become a tax on mobility. Nevertheless, demand in the new homes market remains robust and we have not seen any impact from recent domestic and international political events." EPS up 27% to 70.2p and dividend increased 70% to 17p.

Sain, you are right. Just a little worried about how the comments on the current London housing market will be interpreted. Theoretically speaking the good news is already in the share price, although I have seen that good news needs to be repeated at times for it to translate to share price gains.

I'm feeling a little nervous coming up to the Trading Update next month. Yesterday I worked my way through all the webcasts from TEF and the emergence of the institutional interest came about quite recently. I'd be concerned that with the downturn in the London market this might squeeze the margins on any future deals or the institutions may simply shelve any plans until the picture for London is more clear.

Good evening Sain, What's your opinion on TEF achieving the £40M estimated profit for 2018? It's a while since TEF repeated this guidance. When you speak about positive things like completions & launches then negative things like sales discounts and the lack of foreign launches I find it hard to envisage how it might affect profitability and even which years profit will be affected. I've still got a lot to learn :) If I had the understanding that you have of the business I'd be creating my own profit estimates and revising them periodically.

Strictly, You are correct, my interest in historic p/e ratios is partly because I want reassurance we're not near an historic high. Also, if we had been near an historic low then you could probably, over time, expect a return from a re-rating to complement the actual return from the companies own earnings growth. I did try and look up the info. before asking you and found that there is some historic data from the Risk Measurement Service in the ICAEW library. https://www.icaew.com/library/subject-gateways/financial-markets/knowledge-guide-to-pe-ratios It would be interesting to see, not only the average but also how far from the average and in what circumstances the peaks and troughs occur. However it sounds like hard work with a journey down to London required. Finding a library that has old FT's on microfiche might be the best way though because it looks like the data from the Risk Measurement Service only dates back to 2008.

> I've said many times I give it 5 years and they will be gone it's not a sustainable business So why waste your time even thinking about it? You don't even charge a commission so none of their claims apply to you. You can even benefit by piggybacking of their allegedly false claims by highlighting that you don't even charge a commission and highlight the differences. Look at all the other Estate Agents who are less than 100% truthful. Plenty of them (if the Court Cases are anything to go by) over the years being downright criminal. Just reading the articles on PropertyIndustryEye you can still read about them ripping customers off.

Don't you have any work to do? I'm retired so I have an excuse. And, no, I don't hold PB shares. Just amused at your obvious glee :)

>I think it would be a bit of a nightmare trying to make sense of those in any coherent, meaningful way as they change so much! You are probably right. I just wonder whether there is some way to chart how much investors are prepared to pay for earnings (preferably future). Perhaps an average share price (monthly or quarterly) against some measure of monthly or quarterly earnings. I've never really thought about it before but have seen figures for the p/e ratio of, say the ftse 100, referred to.

> its not difficult to see that the Greystar deal is effectively 2 and a half years of current annual output Sain, after I posted yesterday about lack of Analyst comment over this deal, a couple of thoughts re-occurred. 1) this might be because the deal is not actually done until planning permission is approved ii) the company already accounted for this deal (or a similar one) when they gave guidance of £40m & £50m profit for the next 2 years. In regard to the second point, I recall you saying that profit is spread over the years for this type of development. Also, I do know that TEF originally gave their £40M and £50M estimates quite a while back and still give the same guidance. Would you agree that this deal, when it goes ahead, will mean about £10M or more of profit for the 3 years of development?

Strictly, you mention TEF were 4 x PBV at one time. Is there an average value for builders & TEF during the time you have kept records? I'm thinking along the lines of whether the sector is currently valued at above average or below. Also p/e ratios. Are these something you keep records of? Again I think it would be interesting to know where the sector and individual builders currently is/are in terms of the average over the years.

terrace, I accept switching in and out is not for everybody and different standards in terms of transparency would be a flaw in a system that relies on guidance from the companies. When you say transparency is less at BWY & RDW, what do you mean? Do you recall any particular instances where they have been less than 100% transparent? In regard to TEF I suppose the argument against the guidance for the next few years being an indication of future price growth is the "efficient market" theory. That all news and guidance is already in the price. Personally I don't accept this theory 100% but do to a large degree.

>Ask Terrace. What you see is what you get with Telford Homes No need, I already think that's the case. I have nothing against TEF and I'm confident of good SP performance over the medium and long term. It's just the SP doesn't move how you'd expect sometimes. Even after the announcement of the Greystar deal we saw nothing. No analyst upgrades or comments and no SP movement. Hard to come to terms with when you see PurpleBricks' shares move on a rather ambiguous tweet :)