Member Info for WiganWarriors

Yeah, IMHO should be taken as good news. Builders expecting it to end at some point, so finishing in 2023 gives plenty time to plan. Although the extension is only for first time buyers and is capped at 1.5 times average price first time buyers by region. Also good was formal acknowledgement that Letwin review cleared builders of land banking. Be interesting to see how the Market reacts tomorrow, glass half full or half empty ?

Well, unless someone knows of some negative news planned in Monday's budget for the soft drinks industry (sugar tax), perhaps today's price is a decent buy. Just decided to add some for my ISA's using up some spare cash.

JL, I've been watching RPC for a while and currently do not hold either long or short interest. I sense frustration on your part, so I guess you are long. My comments are fair, and no doubt would have others in agreement, especially from an independent no position perspective. If you have experience of PE, then you will know the potential outcomes, not usually good for many apart from the PE team. Lets see how things pan out, and I hope your position is rewarded eventually.

Well, given the general volatility in global markets it’s hard to see PE paying a penny more than necessary. Arguably the company is worth less in these markets than when PE first declared their interest. IMHO there is s risk they could walk, and return next spring with a lower offer, or even walk and quietly support other third parties interested in a deal at an inevitability lower price. These markets are unforgiving at the moment. I would suggest the risk is to the downside at the moment.

Yeah, Alastair Gunn from JAM was talking up CRST yesterday, he's probably well underwater on his 2.6% stake. However, I have always hoped that PE might be tempted. Problem is that at these prices they are likely to take the company for a low price, given a 5-7 year view. I don't think CRST would be front and centre, as their metrics are poor. That is why they are amongst the worst of the builders re SP. For example, Redrow and Berkeley on a PE's of about 6, with EV/FCF of 9 and 5. Compared to CRST on a "bargin" PE of 4.7, but EV/FCF of 30 times means that they are not able to generate cash profits. Just to reiterate for some posters on this BB, PER is not really valid for builders, as Enterprise Value and Free Cash Flow is more relevant for cyclic businesses. Seems Wimps shifted a few more CL apartments over the week, likely due to some small incentives. Dont take this as red, but I believe that they are coping with the CL slowdown quite well and will likely be able to talk it up at the trading statement. Outside of CL, south west slowing a little but the rest seem steady.

DC. Well 12% is historical, going forward the “Market “ does not believe specials will be maintained beyond next year. Either way, a special dividend is just excess cash being released, so no guarantees that he SP should recover once special goes ex-div. TW has defined its plans for normal maintenance dividend, and I would suggest that is what the Market is more concerned with. Normal divs are much more reliable, and messing around or reducing them is usually catastrophic for companies these days. Personally, I would rather see excess cash use to restructure the balance sheet as just paying out cash attracts unwanted tax obligations, not efficient use of cash from my personal perspective. I agree that TW out of favour within the sector. History of surprises does not help. IMHO, need no surprises in the budget or Letwin s review, and a decent settlement for Brexit or new vote and confidence will return.

Sure, but lots of posters on this BB only expects shares to rise in value, and when they don’t rise but fall they then proclaim to be “locked in”. That’s not investing. You always need a clear understanding why you make a trade, and if conditions change you need to reassess. That may mean stay put or get out. But just to say I’m locked in is putting your head in the sand. Of course, if the shares recover that’s good, but there are many cases where they don’t. Guess we are not too far apart on views, but there are many inexperienced posters here, some with an alarming lack of understanding of ability to understand basic metrics and principles of valuation.

DC, I also agree. The best policy is to “mark to market “, that way you are not dreaming. Otherwise you have actually lost access to your money, and in many cases put your life on hold whilst you wait for the SP to recover to your actual purchase price. That could be years.

Another day when I go to bed poorer than when I woke up ... a frequent occurrence these days.

Yeah, they are ceded to him as part of the management incentive scheme, he has not bought them. Sure they are now underwater, but they won’t vest for a few years anyway, so theses falls are sort of academic really for the management.

Well, does seem that Jeff Fairburn’s inept handling of the BBC interview has kicked this off today. It’s likely to be all over the news tonight and is currently trending on social media. Risk is politicians will feel the need to dive in and do the populist thing, without caring about the collateral damage to housing market confidence. Hopefully Hammond won’t feel the need to collapse HTB in the budget, otherwise the SP will respond negatively. I would guess that Fairburn will become a figure of hate over the next few days, but like Fred the Shred did.

I would hazard a guess that it was Jeff Fairburns interview on Look North last night which has triggered the fall. He was pigeon holed re his £75m bonus, and couldn’t really handle the question. Thousands of tweets. Just more bad publicity to affect sentiment.

Well, supply and demand is over rated especially in shares that are subject to “special situations “. You can have more buys than sells and the SP will still fall. Volume is a much better indicator, especially when you have 3bn+ shares issued. Unfortunately sentiment is poor for the builders and the big institutions are sitting it out until more clarity re you know what. As for BKG and BDEV, both have reported recently so the Market feels reasonably assured, so they are likely waiting with interest for Wimps update. If all good, and no collapse of you no what, it may be our turn to catch up if volumes increase. FWIW, seems Wimps are actually shifting their CL flats, albeit with some incentives in order to get sales booked before year end. We can assume that even though more caution elsewhere in country, they are selling well outside of South.

BDEV update was ok, but CRST profit warning has spooked the market. Seems they got it badly wrong, and management have paid the price. Bit like BVS this time last year.

Banker. I have to agree. Like all "story" stocks they suck in the less experienced retail investors who believe that they alighted upon a wonder stock which will make them rich. IMHO, like many other "story" stocks this is just an interesting technology looking for a problem to solve, and this process can take years. Meanwhile all the seed capital and IPO proceeds disappear and either continuous share issues follow with a declining SP, or they shut up shop and sell of any patents for negligible value. OF course, IMHO and time will tell.

BWY annual report decent, although points out Brexit related risks. Also, house price inflationary gains ebbing. However, generally steady and notwithstanding the risk of Brexit wobbles everything fine. Like most other largish builders are reducing exposure to Central London, although run down of Nine Elms site has steady sales and expect to exit next year. My tracking of Wimps CL shows that they are working hard to close sales, but no disasters that I can ascertain so far and sales seem to be decent. See what BDEV have to say tomorrow, I guess more of the same. IMHO we will be in the doldrums until the large investors get of the sidelines and return to the sector, and as a consequence we are suffering low volume with just the hedgies and professionals trading. Retail investors getting stopped out or throwing in the towel.

The government has set up a review of the current system, with final decisions yet to be made. The £10 limit is one of the ideas put forward. Not sure if this is meant to be retrospective, or that they will allow single houses to be sold under leasehold again with £10 maximum. Either way, I guess the builders are happy as they usually get the bad press, even though the purchasers also have an obligation to understand the leasehold terms before they sign on the dotted line. As I commented earlier, it not a big deal in cash flow terms if it is capped or just sell as freehold.

That’s about £4M to Wimps per year. Small potatoes in the scheme of things. I suspect builders have psychologically given up with leaseholds, and would welcome the change.

For those who are interested.

http://www.propertyreporter.co.uk/landlords/landlord-purchases-down-30-in-3-years.html

Well, that’s as I remember it. Although I do the majority of trading in SB these days as it’s entirely tax free, so not had to use the CGT calculator for a few years. I just take max CGT allowance out each year from long term non SB holdings. I have always understood that the first two options stop you booking the loss, the third is ok as it’s your long term running average. The first two are seen as manipulative. So, if you do as you suggested you would fall foul of option two, and disqualify those previous sell trades from booking tax loss, as they will be matched by the buy trades within thirty days. I will look up again out of interest over weekend, as I’m working from phone at the mo.