Member Info for TakingMyTime

Shorting only hurts a company if they are looking to issue new equity for financing.

Shorting might hurt mgmt/board if their bonuses are based on share prices. Could actually save the company money.

Shorting should be regulated to ensure that you can pay up if you take that kind of risk. There's nothing immoral or even particularly damaging about shorting. If people can bet on an asset going up by buying it, why should they not be able to bet on it going down by shorting it? As long as they can afford to lose the money....

"I'm not so sure that no divi is priced in. One of the reasons this has not dropped like a stone today."
Maybe not fully priced in, but do you really think it is just us here on this board that think it might not happen? I guarantee there are a lot of market players out there who have some doubts, and that's reflected in the price.

It's possible that if they fully maintain the dividend that would be price-negative, because it would be seen as irresponsible by some market players. But, we've got another week and the news can change in that time.

A sign of the times that we're living in when you say it hasn't dropped like a stone, and I agree with you, even though it's down 4 1/2%. In normal times, that would be dropping like a stone.

Stay well.

Dividend cuts are already priced in to some extent. If the market believed the dividends were going to keep rolling at the same level this share would be much, much higher. I now do not expect a dividend, and I expect the market will mostly shrug when it is announced. People are buying (or holding) on an expectation of future dividends, not on this next dividend. Most people expect it to be entirely eliminated, or at least cut significantly.

Wow, that buy of mine moved the market! Am quite proud of myself! LOL.

Your guess is as good as mine but I just increased my holding here by 50%.

I can wait 10-15 years, I certainly expect to be able to take a profit at some time in that period, and in the meantime I expect there will be reasonably good dividends.

If your investment horizon is shorter, then your analysis might be different from mine. There's definitely a risk that this share could drop further in the next few months. I personally expect a rebound in the economy generally and in the oil price (and thus BP shares) sometime in the next 6-12 months. But I get it wrong often enough....

Wish I'd done it Friday but would have taken my cash reserve below my comfort level (in times like these, my comfort level for cash is higher than normal).

Am still of the view that PSN's cash reserves and land bank make it the best builder ATM. And also of the view that some housebuilders may go to the wall and that could create an opportunity for the strong who survive, and I believe PSN is likely to be one of those. I expect the price to at least double within 2-3 years.

I recognise there is some risk here, but anything but cash is risky, and cash is risky, too, because I expect governments around the world to take many inflationary measures to restart their economies, and inflation eats the value of cash. On the whole, I think this is not a particularly high-risk investment. Perhaps I will regret that thinking later, we will find out.

"Does TRY have a land bank? My view is its that which has dragged this down. The carrying value of the land i think would have dropped and that will be reflected in the NAV at the next valuation point."
You are probably right that is part of the picture. But then the question is, will that be permanent or not? For housebuilders, those that had a land bank in the credit crunch did well by it. If the government starts pumping money into the economy to get things restarted again (which seems likely), won't land values bounce back pretty quickly?

Am considering doubling down and buying more....

The buyback drives up the price. It increases earnings per share, which increases dividend per share.

I don't think they are planning a buyback. They are holding funds until the uncertainty is resolved. If it resolves relatively quickly, having the cash may give them an opportunity to buy equipment / material / land at a bargain price.

In a crisis you conserve your cash. Hurts for those who were counting on that dividend, no doubt. But it is good management long term.

As to the idea that the executives made this decision to improve their bonuses, that's nonsense. They don't have the power. The board of directors will have made the decision.

Personally I'd rather see them make sure the company survives and is in position to go forward and pay dividends for years to come. If that means holding off on a dividend, that's fine. If you can see the future and know how long the company will be shut down and how quickly the housing market will come back, share the knowledge with us. Otherwise, I'm happy to see them stay careful.

Hi, Nige. I'm sure they'll stop completing houses. You might see some outdoor work progress but all finishing work inside will stop.

I still expect a strong recovery but it does depend on how long this takes. There's nothing free in life, it all has to be paid for. The government may "pay for" propping up the economy but we'll pay for it in higher taxes and reduced benefits/services, and that means less money (or devalued money) in bank accounts.

A housing shortage doesn't necessarily equate to house sales, if people simply can't buy them. And government can only do so much. So my hopes for a strong recovery in 2021 are somewhat dependent on how long this lasts and how much it costs, in economic damage and government debt.

Hi, wilfie. They've announced they are canceling next week's and postponing July's.

So hard to know what will happen.

If this all blows over in 3 months, the first thing many people will want to do is get out and go places. And if people are hurting financially, cheap clothes might be appealing.

Unfortunately I expect it to drag on for a while, in which case it might really hurt badly. We'll see.

I suspect that most of the market is already expecting at least a temporary suspension of the dividend, and that is a factor in the huge price drop we've already seen.

"why would psn suspend the divi,they can hold onto their houses and sell it later if the crisis goes quickly"
Just depends on how long this lasts and how much money they lose. That cash is the best guarantor of the company staying in business and returning to profitability quickly and they shouldn't disperse it unless they are very confident they don't need to retain it.

They have to pay salaries and other expenses even when houses aren't being built or sold. They don't know how well the housing market will bounce back, or how quickly. Sales are going to be in the tank for the first half of the year, at least. I expect house sales to be very low the second half of the year because people are scared about what's going to happen to the economy and their jobs in the long term. And Brexit is happening, too.

If this runs its course and we get back to some semblance of normal without losing 1/4 of our jobs in this country, I expect sales to pick up a lot next year, but I expect this year to be largely a disaster for housebuilders. I think that makes it a great time to buy them but not a very good year to expect high dividends from them.

That, of course, is only my opinion and I've been wrong lots of times before.

I still like the share and in the long term I expect it to bounce back. I have time.

Hi, Wilfie. The company could go bust if the recession is bad enough that no one can afford to buy new homes. Given the amount of lovely cash the company has, that's very, very unlikely. There will still be a housing shortage, so some people will still be buying homes, even if the economy takes a bad enough hit that house prices drop somewhat.

Since PSN has more cash than some other housebuilders, they are likely to be one of the last survivors. So I'd be amazed if they go bust.

I won't be surprised if they stop paying dividends for a while, if they lose a lot of money. I won't be surprised if it takes a while for the share price to recover. But I'd be very surprised, even in a horrible down-turn, if they go bust. They are in a better position, IMO, than they were before the credit crunch, both in absolute terms and relative to their peers.

What I really expect is that this will run its course over the next few months, by summer the worst will be over and we'll be in a "it's here, we have to live with it" phase, just like we've been with flu, cancer, diabetes, and a bunch of other stuff. It will be bad and more people than we'd like to think about will die, but it will settle down and society will learn to cope with what's left. And then governments will pour massive amounts of money into the economy to get things restarted again.

When that happens, people will still need houses, and I expect the strongest housebuilders to survive, with some of the weakest folding or perhaps being acquired by some of the stronger ones. I'd include PSN among the strongest ones.

That's what I think will happen but I'm an optimist....

The share price right now has nothing to do with whether the company is going bust. It has to do with panic because people don't know how bad this is going to be both in terms of the pandemic and the impact on the economy. Whether that fear is well-grounded or not we don't know, but it really has nothing to do with the strength of the company, it's all fear-driven. If the fears are right the company may still be overpriced, but it's not going bust. If the fears are wrong (which is what I think), the company is significantly underpriced.

If you are a nervous person or can't afford to take a risk don't buy into this market. If you are really nervous you might want to sell while you still can, but there's a very real risk (in my opinion) that if you do so you are selling at a low point and will lose a lot of money. Usually one wants to sell high and buy low, and you'd very possibly be doing the exact opposite if you sell now. But none of us know what the future holds.

I've taken a risk and increased my share holdings in recent days. Clearly missed the bottom of the market and did so too soon but I think I got good value and will benefit. But I have the reserves to ride it out and time to wait, and not everyone does. It's not a market for the faint-hearted.

IMO, of course. Could be wrong, it's happened many times before.

Everyone is going to be losing some money in the next few months, that's pretty clear. PSN has loads of lovely cash to bring them through, they'll be one of the survivors and will likely come back even stronger as a result.

Just doubled my holding here. Almost did it a couple days ago and wish I had but this is too good to pass up. Sanity will return to the markets sometime in the next year and this will be back over £5, easily.

"Now if I could filter by content as well, then all mention of him would disappear from my life ... oh, and wouldn't that be bliss?"
Well, we could all report his posts since as I noted before he breaks posting rules all the time. But maybe it's better for people who think like he does to have some outlet, and this one isn't really doing us much harm. At least, that's my view FWIW.

Let's see. -62% of 9 months is approximately 7% a month. So his chart tells him that 7% a month for 12 more months would be -84%, give or take a little, which would be down 146% from where it was 9 months ago.

So that's like, I don't know, -250p or something like that.

Why stop at 0?