Member Info for TakingMyTime

Red flags:
1. If you can't stomach a lot of volatility, stay out. This will go up and down like a yo-yo.
2. Russian exposure.
3. Vulnerable to US/China trade war.
4. Vulnerable to currency fluctuations.
5. Relatively high gearing.

Their Russian peers tend to pay virtually everything in dividends. EVR doesn't quite do that, they've reduced gearing some. And they've committed to some significant CapEx. But you should see significant dividend payouts if you can stomach seeing your share price bounce up and down like crazy.

Yeah, I've decided to stick with it, too. Could have taken a profit but I still think there is significant upside here. High hopes for Primark US expansion. Also I expect sugar division to improve substantively. I also think the pound strengthening helps ABF and that once Brexit is done and a couple reasonable trade deals in place the pound will strengthen. Might take 18-24 months for that but I can wait.

Hi, Nige. As you know, I'm more of a buy and hold kind of guy. You are too for part of your holdings but like to beat the market with your float. TBH, I don't have the time to study that stuff out. I think you are retired, so this game makes sense for you to play -- for me, it's enough to try to figure out which companies look promising and fit my overall strategy.

So I suspect you are right but that old DYOR thing, and not having the time to do so, means I'm just not at the point in my life where I can try to time the market like you do.

I made sure to be 100% invested before the election, that one seemed obvious to me, and I've pulled out some cash now because I see turmoil over Brexit for 6-9 months. But to try to figure out which reports are likely to send the market up or down is beyond me right now.

"i think it could have more than one effect either up or down even if its positive or negative"

It could be good results but the market could pick up on one statement that makes people think it is projecting bad news, and the price could drop. Or it could be exactly the reverse. Or, it could be mostly steady as she goes and the price might not move at all.

Fundamentally, I'm convinced the share is still underpriced, so I'm just holding. If the market goes up, or down, this week, is unlikely to change my view. The statement may change my perspective of how much underpriced I think it is but it is unlikely to be a game changer for me.

Margin was 30%. If it drops to 28% due to improved focus on quality issues, I'll assume the company is going to keep making money and keep paying dividends. If it drops to 25%, the same, if we begin to see margin down around 20% I'll be concerned. If it stays at 30% and there's significant evidence that build quality is improving I'll buy more.

The kinds of things that could change my view are likely to change slowly, over time. I don't expect the trading statement to move my view very much. But market sentiment is a funny thing and it certainly could provide all kinds of bounces.

Iran obviously wants to return to asymmetric action through proxies, just like they've been doing for years.

Trump wants to keep being unpredictable. If you are unpredictable, your adversaries don't know what they can get away with, or how far they can push you. If they know your red lines, they know exactly how far they can go, and they will.

Iran doesn't want to find out what will trigger a massive reaction, so this is probably it for direct action from Iran. Whether they've triggered a response, no one can possibly know. From a domestic political perspective, Trump has everything he wants out of this. If no Americans were killed, he'll probably leave it. Lindsey Graham's statement is a warning to stop, not "You've crossed a line, you're about to get hammered."

If I had to guess, I'd guess no more direct action from Iran and only direct action from the US in response to further asymmetric action. If that happens, it might be down the road.

> £1BN cash, 30% margin, AND healthy land bank.

Just keep correcting the build quality issues, don't do stupid stuff on exec compensation, no more bad leasehold deals, and play the PR game well.

Hi, Tony. Lots of people are tipping PSN these days.

First, I think the reputational thing has turned the corner. Current management has played it exactly right. 1) Said we need to change. 2) Delayed sales, which may or may not matter much but it is something substantive. 3) Commissioned an independent report to get all the issues out on the table -- no more drip, drip. 4) Changed exec remuneration package and replaced both the exec and the people who gave it to him. 5) Every piece of bad news in the last year, they've already been working on correcting before it hit. Obviously better NOT to have the bad news but at least they have been handling it right. 6) Came up with a creative idea (retention policy) which virtually guarantees that a lot of buyers won't be scared off by quality issues, and also lets them claim to be market leaders on customer care.

Some of these things will cost some money, but none of them should have any major impact on profitability. So it isn't surprising that we see PSN tips popping up all over the Internet. Here's another from Tom Rees of the Telegraph. After talking about the reputation issues, he says this:

But now could be the time to snap up Persimmon shares. First, shares in housebuilders are on the rise after Boris Johnson’s election triumph lifted the economic outlook and lacklustre property market.

Second, City scribblers believe Persimmon has already taken a number of steps to address the issues raised by the report on build quality.

And finally, if you are not convinced by the share price story, a bumper dividend yield nearing the 10pc mark could be more persuasive. That is the fourth best in the FTSE 100 and, unlike similarly strong payouts from Centrica and BT, Persimmon’s generous dividends look almost as safe as houses. Some analysts are predicting they could go even higher.

Persimmon shares are already on solid foundations and the company should build on recent gains in 2020.

I shouldn't have sold out of rdw after the election. Worked out pretty well for me with the others....

Re: trade on volatility, or hold, I suppose I'm doing a hybrid. Holding PSN, took profits on other builders and holding it in cash assuming volatility will take us lower over the summer.

Hadn't really noticed the 1st half of year thing, maybe I need to get back in. Wonder why that is....

Hi, Nige. I suspect he does want a deal but is prepared to walk away if the EU doesn't give enough ground.

As an investor, you'd want to be in cash if it ends up no deal, as you said, but to be fully invested if there is a deal. We saw how quickly it happened at the election, builders up 10+%. That will happen again if a trade deal is agreed. But how to know? Even if you believe he does want a deal (and I do), that doesn't mean the EU will agree one that he'd accept.

I took profits after the GE, though still heavily in PSN and some non-builders. But I think I'm going to stay in cash for a while, I trust the BBC to bleat about no-deal enough to drive sentiment down. But I think I want to be pretty much fully invested by August, to ride the lift up if a deal is agreed. If it isn't, since I'll be heavily invested in builders at that point, I'll assume they are still going to recover even after a no-deal drop.

Hi, Nige. Sounds like your approach is working quite well for you.

No-deal vs deal is not a binary thing, remember. Very possible we'll get a partial deal by next December, with more details to be ironed out as things go along. I don't think either side will want to admit they have no deal, so will likely agree what they can by then.

Not that I think it matters much re: builders, they'll make money and pay divs anyway, whatever happens with Brexit.

Merry Christmas to all here!

Hi, Nige. My view is that PSN was further undervalued than the others due to reputational issues, and has been making up that ground since 13/9. Could be wrong but that's why I think it has outperformed the others.

Saw what you wrote on TW. I don't expect a slump.

Not familiar enough with Nanoco to have an opinion.

Merry Christmas! Probably letting my investments sleep until New Year.

Hi, Nige. Released on 17 December. Here it is: https://www.persimmonhomes.com/corporate/media/397416/findings-of-the-independent-review.pdf.

Here's the kind of thing I've been saying is coming. To be honest, I never expected it to start with the Guardian, and I didn't expect it for a year or more still:
https://www.theguardian.com/business/2019/dec/22/persimmon-putting-house-in-order-corporate-world--pay-attention

We're both agreed that sentiment is the only thing holding back builders. This marks, for me, the beginning of the turning of sentiment, when PSN starts to get credit for the steps they are taking. That it is coming from the Guardian means others will pay attention. I can't tell you what to do with your float, but I took profits on all my housebuilders but PSN. I think as EU trade deal uncertainty grows builders will take a hit, but I think PSN sentiment is going to start turning anyway.

My crystal ball is imperfect, but I'd definitely stay significantly invested in house builders (unlike you, not wholly, but still significantly), and for me PSN is still the best bet in the medium term, and possibly in the long term. I don't think you'll go too far wrong, in whichever one you'll put your float but if it were me I'd be heavy on PSN.

@Nige, haven't looked at exstatex in ages. He must be completely distraught over the election results, undoubtedly thought Corbyn was the answer to everything.

I gave a good long think about it and I'm holding. My reason for doing so is that I still think the current regime 'gets it' and are committed to fixing it. The report was bad, but who commissioned it? The company themselves, commissioned an independent report. You don't do that if you are trying to cover things up or intending to just carry on.

I think this is still a very good long term hold that is going to keep paying substantial dividends in the interim. Eventually, the narrative will turn on this company and the shares will climb. They already have to some extent. When we get an EU trade deal, they'll climb more. But sometime in the next 2-3 years there will be puff pieces about the steps they've taken to be a good corporate citizen. This damning independent report that they commissioned is part of that narrative, so is the change of administration, the new retention policy, etc, etc.

I'm sticking in, for the long term.

@wilfie, the bashing this time is because of the report that they themselves commissioned. They brought it on themselves, and I think they did so intentionally. I'm of the view that the best way to change the narrative is quit looking like you are hiding your dirty laundry, and instead getting it all out there. Get the hits out of the way while you still have a nice cash pile, and once all the hits are done, then pay a nice dividend in the spring, and another later, with no more bad news rolling out.

I think they decided since they weren't going to get a good press right now anyway to go ahead and just get all the bad news out, over and done with. I support that approach.

Thanks, all the best to you.

I have to decide today whether staying in PSN was a mistake or not, and whether I should flip out of it into TW or another builder. I still think the fact that they commissioned the review themselves is a good sign, but it's pretty damning.

Hi, troubles, sorry I misunderstood. Perhaps I misunderstood because I did predict those things in discussions on the PSN board. I predicted a deal with Farage (in BoJo's mind, it's comparable to Churchill's deal with Stalin -- making a deal with a devil to defeat a worse devil). I also predicted that he'd use the threat of a deal with Farage and no-deal to get the EU to reopen the WA when everyone was saying they wouldn't do so. I didn't predict the terms of his deal with the EU but I did predict he'd get them to do a deal that would be different enough from May's to get ERG onside with him.

It did surprise me that he broke faith with the DUP. But he'd already decided to torch his own "majority" and appeal to the voters, so he didn't need the DUP anymore.

I see that one post has been removed, which is good. We've got a divided country on this topic but telling each other to shut up isn't going to solve that.

"You mean like the withdrawal arrangement and the deal with Farage.
With the help of the media and 24x7 brainwashing, it's possible to make certain sections of the populace believe anything.
Market sentiment is transitory and can be influenced by those that have real power, doesn't matter which puppet(s) they promote to run the country."
Most of this has little to do with what I said.

Investing never goes well if you're focused on what you think should be happening rather than what actually is happening. Boris Johnson is way down on the list of people I'd like to see as PM, but he's who we have and is probably not resigning anytime soon. For me, I'll try my best to understand him because that can make a difference as to what I'll have in retirement and what I can pass to my children / grandchildren.

Hi, troubles. I don't think he's a Churchill at all, but I think the book gives a lot of insight into how we can expect our PM for the next five years to act, and that's the environment in which we are investing. His book is not really so much about who Churchill was but about who BoJo wants to be, superimposed on Churchill, his interpretation of Churchill.

As an investor, I need to put aside my opinion of his character and try to predict his actions and how they will impact my investments or potential investments. Whatever I may think of him as a person or a politician, I can be just about certain that he's going to have a trade deal with the EU 12 months from now that he can pronounce to be a good deal. And he's also going to have other deals, including probably with the US, that he can point to and say, "See, Brexit is a success." Whether those deals are going to be all that good is yet to be determined but they will be in place and he'll be boasting about them, and it will affect market sentiment.

He's looking for 150.

Either that or he did the smart thing and closed out his shorts once the reversal became obvious, so has no reason to post on this board any more.

Further: I've just taken profits on all my builders except PSN. Wish I'd done it yesterday, but I've done really well even so.

I'll be buying back in, probably sometime around August. About that time the BBC, Labour, and the Guardian will be in full panic mode about a cliff edge, and EU officials will be saying, 'It's not too late, we could still agree an extension.' Share prices on builders and some others will be dropping again. I'll buy in, and sometime around September-November a trade deal will roll through.

They won't leave it to the very last minute because it will be too much of a pain for exporters, port authorities, etc. But both the EU and the UK will benefit from a trade deal, so a deal will happen. Money talks. And when they do that deal, will get another bounce, this one more permanent.