PYX Resources: Achieving volume and diversification milestones. Watch the video here.
I think buying into housebuilders in the last 6-9 months has been a no-brainer and pretty easy money. Since it became clear they would be able to ride out the pandemic and recover rapidly this has been a great investment sector. From this point forward however, I suspect it will not be so easy. Does anyone have any thoughts on which of the UK housebuilders are still undervalued and have further to go? I'm thinking quality housing in the right locations is the key (without having precise ideas on what that actually means just yet).
All weekend I've been seeing coverage from Bloomberg, the FT and others about the chip shortage around the globe which makes the loss making IQE even more of a mystery. I understand that not all chips are the same, but if they can't satisfy this demand and make a profit, maybe they are making the wrong chips? I also see from others posts and the news on this site that they even have spare capacity... what are they playing at? This sounds like a boom time for their industry where they should be able to exercise pricing power to increase margins on increased volumes. If they can't make money in these circumstances is there any hope for them?
I think the end of quarter rebalancing affected the UK market as a whole, plus Persimmon has had a good run so some funds may have slimmed down their holdings a little. I feel pretty confident about the UK market generally and the housebuilders particularly, so here's to a good Q2 of 2021!
Don't forget the currency issue... A lot of ULVR revenue comes from outside the UK so as the pound is currently on a upward spurt, that income is worth less when converting it into GBP. The pound weakness has largely been because of uncertainty around Brexit and so is due a revaluation. Not sure how high it could get to in the coming months, looking at the GBP/USD you have to go back to 2014 for 1.70 and 2016 for 1.50. It hasn't been above 1.42 since June 2016!
Hopefully this news has put RCDO on the radar of the "green tech" brigade. They will invest in anything eco related, so maybe we can end up with a hyper-inflated share price! Not sure that will help the company, but such is life.
Broker recommendations seem to do this all the time... bunch of idiots! If they really believe fair value is more than 10% below current price, they should be recommending a SELL, particularly is there is no dividend income to sit tight for.
Still, that's why private investors like us still have a place in the market... better off than handing fees to these fools to manage our money for us.
thehdoggydog... I really like the way these guys do it https://simplywall.st/ They publish their methodology and produce some great analysis. On the subject of calculating fair value have a look at this example https://simplywall.st/stocks/gb/consumer-durables/lse-rdw/redrow-shares/news/are-investors-undervaluing-redrow-plc-lonrdw-by-23
Yes, it is for a different company, but shows the approach nicely. If you're curious about BWNG, this will probably surprise you! https://simplywall.st/stocks/gb/retail/aim-bwng/n-brown-group-shares#valuation
Always the same this time of year... step away from the screen and look out of the window! Seriously, it's good to take a break sometimes and low volumes at this time of year make thing very hard to trade. Check out some Netflix!
I removed my stops on Friday just in case and was glad I did. I hate movements like that... really does make the game feel rigged against us smaller players. I hope not too many were stopped out here.