Member Info for Nige_W

Hi Strictly and TMT
Wow! I have the greatest respect for both of you, but this is what these Boards are all about. Constructive Discussion, so I hope you can both continue a civil and courteous conversation.
We can all live and learn off each other.

Hi Strictly
Thanks for the Info.
A downward drift in House prices adjusted for inflation infers Houses are becoming cheaper, but doesn't mean much if Builders margins (generally) increasing, other than Companies addressing specific issues (Psn quality, tw seems to have overcome that now).
You infer that the end of low interest rates could be approaching. I don't think so. Banks set interest rates now (not the Govt) and make money out of lending money. So just as a housing slump created by high interest rates, so business will not borrow if interest rates high, so Banks would be losing their main business, if they increased rates.
As I have said I don't watch PBV, so can't really comment on that.

Hi TMT
I sent a message on tw about how relative prices converging, which implies Sp's driven by momentum and highest priced (bdev) should be higher, while lowest (psn) should be lower.
Once momentum out of the way the Sp's will diverge again. I love your comparison and look forward to Strictlys reply.
Another possible criticism of psn is their "brick" factory makes concrete blocks which are terrible for expansion / contraction and sometimes need to be repointed, (from Ben on tw board).
I realise these are short term issues and you look at the longer term - I think prospects of both are great.

As you know I base my system on upcoming RNS's (buy before if I think they will be good) and sell later when Sp stabillises), but RNS's don't really matter.
All that is important is Relative Share Price movement, which leads to my current Plan.

I have 44.6% float in bdev for IntRes 05/02/20 (which I hope wii be good), 32.0% in rdw cos I think they are undervalued and 23.4% in psn for Divi should be 125 (XDivDt 07/03/20) after which no great drop in Sp cos another Divi in June.
No float in bwy at the moment but intend to buy early June and hold until FinRes mid Oct. Between those dates (in early Sep) there is usually a slump, so will keep an eye on Sp and sell, buyback, if a slump happens.
Then sell all mid May and buy back early June (rdw, bwy and psn or tw).
Tw has been outperforming psn recently and better PreFin, so will probably go for tw. Also psn still in recovery process after quality issues, which could still be affecting their results.
Sp has recovered well (maybe too well?)

Look forward to continuing this discussion with both of you and BoL

Hi Tom
My relative price graph is converging, which infers Sp being driven by momentum. This implies highest should be higher and lowest lower. So if 04/01/19 = 100
bdev = 171, rdw 161, tw 159, bwy 156 and psn 152
Note bdev IntRes 05/02/20 and average increase about 60% in little over a year.
At least +ve momentum and just hope it continues.

Hopefully I will need to buy some more ggp on 25% profit again (when Sp reaches 2.59), then 3* orig holdings. Trouble is it's eating up my Isa Builders float.
BoL

Hi Bankfool
As far as I know the system hasn't changed. If I bought 1000 tw shares in 2013 at 100 and another 1000 in 2019 at 200, say I sell 1000 and price is 250, I can choose which I sell - either the first bought giving a profit oy 150 (fifo) or the last bought, profit 50 (lifo), as though I was selling the share certificate.
Obviously I use lifo, but some time ago I think I saw something about using average price, but think it was no more than an option.
BoL

My system is to hold a base value in 5 Builders and move a float between them (equal to the sum of Base Values).
Using Last In First Out method you never sell the first shares you bought, so can accumulate held profit as opposed to realising it in Deals completed (subject to CGT). Now I have over 100% profit on all Base values and an average of 19.8% on 3 companies Float (all held since 25/11/19).
When I sell those Floats (around May 2020) I will have a CGT liability on the Profit made then, so if profit 30% I will have to pay tax on that (less allowance = Nil). Also, I will have made another 30% on Base Values = 130% profit, with no tax liability, and the total Base Value still = Float - just 30% more.
Using this method I think I can make 20% more than Ltbh, by timing the Float moves depending on Rns's.

Missed out on tw excellent results (didn't like their last interims) so no float there, but done very nicely out of bdev Float 44.6%, rdw 32.0% and psn 23.4%. Looking forward to bdev IntRes 05/02/20.
BoL

Hi BBD
I agree the wording doesn't say much, but cannot believe that they started ringing around. Would that not be a bit unethical for a CEO? Also it says parties (more than one), so I assume they were contacted by 2 (or more) companies, then decided to go all in. Then, "a review of all the strategic options for the Company, including, but not limited to, a potential sale of the Company".
Don't think they need to raise any more cash for at least a year and should get that easily (from Loam), and all the strategic options infers 2 or more - mergers etc, infers they are not desperate for a Deal at all, so again hardly driven to ringing around.
Maybe I'm reading too much into it, but this is basically what I thought when I first saw the RNS. No need to sell so must have been approached.
BoL

Hi Skeletor
Just looked up Ulvr on fundamentals here
I disagree with some of the numbers like Per and EpsG my estimate
Coy, Per, Mrgn, Yld, EpsG
ulvr, 14, 14.8, 3.0, 8.0
tw, 11, 20.3, 10.6, 17.0
If tw Per 25, Yld down to about 3.5 as you say, but still better than ulvr, and margin far better while EpsG more than double.

Can't see interest rates going higher, nor Banks becoming reluctant to lend money - that is what caused the Banking crisis, which almost destroyed the system and cannot be allowed to happen again. The only other critical factor to builders is supply / demand.
The current shortage of housing has been created by the Govt (via banking crisis and lack of apprenticeships) and is very difficult to fix so, demand will remain > supply for the foreseeable. What other sector can say that about their product.
So if tw made wheelbarrows but had the same fundamentals, would you agree a Per of 25 was reasonable?

Imho While building was cyclical (last century), they deserved their low Per's, but the banking crisis has made them far stronger (cos of demand for product). So if Per ever reached 25, I would argue it should be 35 cos of the advantage they have over all other sectors.

Back to the real world. I hope the market is realising they need to revalue builders, and in the process of doing this. You mentioned a target of 250 to 270, but if a revaluation in progress they could go a lot higher.
Good talking to you and BoL

Hi Skeletor
Building is no longer cyclical. Besides banking crisis (100 year cycle) there hasn't been a slump this century.
"Economic downturn, or change in demand (decreased foreign purchasers or end of help to buy)" do not affect supply / demand. I think the number of foreign purchases outside London are too small to have any significant affect, one of the reasons I avoid Lse builders.
"Change in interest rates", controlled by BofE now and not going to increase any time soon.
"Stricter regulations" ?
Do you not agree a Per of 25 is justified by the fundamentals?
BoL

Hi nano
From RNS 5th Nov
"Formal Sale Process as Part of Strategic Review
In its preliminary results announcement on 16 October 2019, the Board of Nanoco Group PLC ("Nanoco" or the "Company") (LSE: NANO) reiterated its focus on maximising value for shareholders. In this context, the Company confirms that it has entered into preliminary discussions with certain parties about a potential sale of the Company. Accordingly, the Company today announces that it is undertaking a review of all the strategic options for the Company, including, but not limited to, a potential sale of the Company through the commencement of a "formal sale process", as referred to in Note 2 on Rule 2.6 of the Code."
ie For Sale since 5th Nov but already "discussions with certain parties about a potential sale of the Company."
BoL

Thanks Graham
Some time ago terrace suggested the price should be 241 given a Per of 12.
I said given a return to PreBrexit levels (Per 13.2) Sp would be 285.
But given the fundamentals (Margin, Divis, EpsG, Cash Held...) I would suggest a Per of at least 25 is justified inferring Sp should be 500+, so still a long way to go!

The market has been predicting a slump in builders fortunes for years (particularly after Brexit vote) but all (non LSE) builders have been steadily increasing EPS for the last 10 years. What more proof does the market need?

The recent increase in Sp is encouraging, the reason for it is more interesting - I imagine some sort of combination of GE, Brexit... none of which affect builders at all. Or, the market is realising that builders are totally undervalued.
Whatever, I hope this trend continues, but one thing is for sure, its going to take a long time.
BoL

Hi Tom
As well as being stupid the market is weird. Monday was great for me then everything went quiet until today - much better than Monday.
After reaching 25% profit on ggp I doubled my holding (reducing profit to about 12%) - but now back up to over 19%.
My idea is to repeat the process, but don't know what to sell.
Even nano up 13.1% this week (but can't sell them).
Have a great W/e and BoL

Hi Tom
Most surprised you sold out. Think you will find it difficult to get back in at a lower price than you left at.
Of course this doesn't matter if you are making more money elsewhere.
There can be no doubt (as Owls said) more risk in Aims, but also more potential profit, if you get the timing right, no doubt you will do better than main market (as you have proved), but that is a big IF.
I have a small pension, don't like to take too many risks, so as I previously said, I would not have more than 30 - 40% in Aims and no more than 10 - 15% in any particular one. This suits me, but I have my own system which certainly will not suit everyone.
When you get back into Builders, I suggest you diversify into psn, bdev, bwy and rdw (as well as tw of course), good Divis from Psn coming soon, but bdev doing very well right now.
Thanks for ggp, I will build my holding there. Hardly in a position to advise you, but just my thoughts.
No criticism meant and I wish you the very best of luck.

Hi Warren
This is simply from memory, imagine it was in a RNS some time ago, (can anyone confirm?)
Nano doesn't need to sell and has had no problems raising capital in the past. Now they have some revenue (while raising money previously with no income), and main backer Loam still there.
As I said the price will depend on the value of the Ip. Not only that Samsung might want to deny the Chinese CFQD's to decrease competition, and / or eliminate risk of copyright infringement and / or dominate the world in nano tech.
Much the same applies to Apple, but they also invested £20 m + in the nano factory which they won't want to see taken over by Chinese, Samsung or anyone else.
Also, all the interested companies have seen nano patents so have a pretty good idea what they are bidding for, so I don't think Ip is worthless.
Nothing like sxx takeover and I remain optimistic.
BoL

2 (or more) offers were made for nano before they were even up for sale. Imho these offers must have been considerably more than the Sp (guesstimate 50 +), and either they are still on the table or have been increased since.
Other than that Sp is totally meaningless - it all depends on how the bidders value the Ip.
After due diligence, the initial offers could be withdrawn as everybody realises Ip worthless, or Offer of $1Bn +, if it is the bees knees, infers Sp of 5 to 300+.
Not very helpful, so just have to wait and see. I don't expect any news until Deal done, and hope we don't hear anything until then, cos don't want to be tempted into selling any.

Hi minjin
I never held sxx, Bamps told me it had been bought by AA (and he made money on it). Think 5.5p is about 50% up on prev price.
I am in a similar situation with the sale of nano but hoping for a much better result. Sp around 12 to 13, but hoping for 10 times that, or more. Nano holds ground breaking IP and was not forced into a sale by cash issues.
It all depends on how some massive companies (Apple, Samsung...) value nano's IP, so value could be 5 to 500.
Very, very risky investment, so don't blame me, but a possible opportunity to get your money back.
BoL

Hi terrace
Just looked up a couple of Ftse100 companies on my watchlist:
Coy Margin, Per
grg 8.0%, 17.8
sge 19.7, 24.3
tw 20.3, 6.4
These numbers are from fundamentals on this site, bottom of page, so directly comparable.
Everything else about tw is far better than grg or sge, Cash, Divis, EpsG, hence justifying 25+ for tw Per.
On bwy board I sent you a message why I thought builders Per's are so low. Fundamentally the market is stupid, and this is why WBuffet made a fortune by investing in Value Stocks. This is the best opportunity in my lifetime (pensioner), builders undervalued by a factor of 3, created by Brexit and the markets slow reaction to the changing situation.
DYOR and look up some other Ftse100 companies (Margin, Per...), bearing in mind that prospects for builders will remain excellent for the foreseeable, as long as supply lower than demand, which won't change in my lifetime.
When I say the Sp of tw should be 500+, I get very little reaction here when Sp 217.8, cos most think it is ridiculously high. But the market will gradually revalue builders upwards, towards a Per of 25, no idea how long that will take, but it will happen.
BoL

Hi terrace
That could be a political move so when they release results it infers didn't we do well. Still see no reason for decreasing margins.
Bdev releasing IntRes in a few days (05/02/20, I think), which I expect will be very good. We'll see if their margins decreasing.
BoL

Hi WiganW
Completely agree re diversification - no point in diversifying just for the sake of it. You must know and like the companys you invest in, hence I only have 7 as opposed to the 12 I would prefer.
Sounds like you are talking about Apple or Microsoft as opposed to steady away like builders, but they will do for me.
Hi Tom
No harm in diversifying into other builders, all four that I mentioned have performed better than tw.
BoL

Hi Terrace
No reason at all, but Per should not be 12.0 - should be 25.0+ so Sp 500+.
BoL

Hi Troubles
Read somewhere that all Sp's down cos £ doing well, just as I thought Builders were building up some momentum.
But yet again £ / $ and £ / Euro rates should not affect builders. Utes always used to be regarded as the safe haven, but they all have massive Debt (and foreign owners now).
Just about to delete sxx from my system, in theory delete from Prices WS and system reconfigures itself - not doing that tonight!
BoL

Hi Tom
Your investment strategy has been very successful, so I congratulate you on that, but I do think you should diversify more.
There are 4 more great builders psn, bdev, bwy and rdw to invest in (all doing well), and I would limit my investment in Aims to a certain % of Port (maybe 30 to 40%) and limit investment to Max of 10 to 15% in any particular one.
I know ggp has been great for you, and now I am building a holding there (thanks).
I have holdings in 7 companies and would be happier if that was 10 to 12. I have had criticism for being mainly in 1 Sector, but not too bovvered about that, cos the best Sector.
BoL