Damp Seaweed
02 Dec 2016
Re: BKG results I had been expecting the ex divi to be next week. Also the buyback will not be agreed until next year now. Plenty of time for more volatility.So in the spirit of indecision and opportunism I've sold half my stake @2666p.
PIE-EATER
02 Dec 2016
Re: Didn't see this coming.... But is NXT the exception or the rule?A genuine question as I don't know the answer, but my suspicion/ impression is that it is the exception. Perhaps that's just me.PE
Rhigos
02 Dec 2016
Re: Didn't see this coming.... Damp Seaweed, "Generally I don't I share buybacks. I've never seen one that works out better than straight forward return of cash to shareholders."Buybacks work for NXT, see long period SP chart. Over the last 10 years SP up 170% despite 38% fall in the last 12 months. They do very large share buybacks when SP, in their opinion not overvaluing company. If SP too high they do special dividends instead. Results has been number of shares is a significant fraction of what they used to be but each share worth more as company has grown. Total return over 10 years has been a lot more than 170%.
Eadwig
02 Dec 2016
Re: Didn't see this coming.... Great results again, but I hate buybacks - sounds like they may be going to only buy when the price is lower, which is good (better than most buybacks which are just blind buying rubbish). Even so, I'll probably be buying with them when they do because I'm out approx @2650p for around 15% profit + divs (being a late-comer and having traded my average holding price down several times).Not going to hang around for the next dividend. The only way to make money from a buyback is to sell your shares, so I shall probably continue to trade BKG, but with a 20% drop in reservations attributed to higher stamp duty, Brexit concerns (which are far from behind us), housing cycle around its low point, maybe (hard to tell with the financial crisis and Brexit upsetting the last two cycles) etc. I shall stand back and see how the buyback works out, not to mention the higher-end London market in the shorter term.I still have plenty of exposure to the London area via TEF, and the south east via INL (both opposite ends of the market to BKG), probably too much exposure, and other housing plays, mainly PSN, around the country and TW in the UK and Spain. The latter I shall also be unloading when the right price presents itself as I very much bought at a price at the higher end of what turned out to be its trading range right now.Good luck to all still holding.PS. Didn't check if bought back shares will be cancelled or held in treasury (if it was actually made clear) - Holders want to see them cancelled if possible, and only bought when the price is below a certain level, and ideally, more aggressive buying the lower the price goes. That's the recipe for a buyback that works. In my experience (RIO, NEXT, GLEN, WMH, RR, HSBA and many others, 9/10 do not work for *shareholders*, but very often they do for the board (raising EPS more easily on which bonuses and performance are often measured) and the government always welcomes the extra stamp duty so regulators aren't very concerned.Remember, generally a buyback is essentially saying the board has run out of ways to re-invest your capital to return a profit to you, the shareholder. As far as I'm concerned a special dividend would do the same thing much more clearly. BKG appear to be planning to take a different approach, buying when the price is down out of an amount set aside for dividends, and paying the remainder out in dividends, if I understood correctly. It is an interesting twist and I shall watch it with interest.
Damp Seaweed
02 Dec 2016
Re: Didn't see this coming.... I also didn't see that coming. And I'm sure the first priority will be bonus protection. Generally I don't I share buybacks. I've never seen one that works out better than straight forward return of cash to shareholders. But the strategy makes a fair amount of sense given how the share price has been so heavily hammered to the extent of pushing BKG out of the FTSE100. In principal this should not help BKG regain its position. But maybe if the share price is effectively under written and the divi is good but not too good, then aye BKG can regain favour with the bigger investors.However one should not ignore the 20% drop in bookings. Now that is a worry IMHO.
PIE-EATER
02 Dec 2016
Didn't see this coming.... A revised way of returning funds to shareholders, partly divi and partly buybacks.While I can understand the logic of buying back when company materially undervalued, I am not sure investors will be totally overjoyed at reduced predictable cash divis dependent on what has been spent on buybacks (admittedly from a larger pot, which many were expecting to possibly support even larger payouts)Despite the comment in the release about reviewing the LTIP, i can't help but feel this is the BOD looking after themselves first by trying to support the share price for said LTIP.I may well be completely off base, but that is my first impression. Can't say I am impressed.PEPE
Eadwig
01 Dec 2016
Re: Sound Interims from Telford Homes Dzd&Cfsd,I've actually been doing some 'reverse range trading' on the house price volatility.There was a period when a builder would report 'stonking' [BBC term] figures and the sector would get marked down. We've seen the opposite recently, but the rise only lasts a few days. I've been selling some of my holdings on the rise and then re-buying a few days later, including TEF @320p.It didn't get a good rise on trading statement, not for long anyway, because the same old story about H1 profits being halved was rolled out, so hoping to buy that tranche back around 300p, in time for ex-div on 8th December of 7.2p, Just another way of averaging down if I can pull it off. Previously I had been buying TEF approx @288p and selling around @306p in a slow process of getting my average holding price down from over @400p. The 360p placement very much hammered me and I see that as the minimum price anyone would want to be holding at these days. Quite tricksy because I own a lot of them in two different accounts, and don't want to be caught out holding even more if I get it wrong.So far its gone ok and both averages will be down to the low 370s assuming I can pull off this latest 'reverse trade'. Done the same in TW, totally based on other builders results, but the range there is only about 146-154p, so not much to play with.
dazedandconfused
30 Nov 2016
Sound Interims from Telford Homes ..stating no change in their London market post-Brexit, in non-prime areas. Surprised that other Housebuilders have gone down, but the last couple of weeks their prices have gone up and down like...those famous drawers!
Eadwig
20 Nov 2016
Re: Added Today @2400 LKH, "Did you see that Barratt has dropped its high end prices by 10%?"Actually I didn't see that. I did search Barratts live sales sites and found 61 properties unsold across 11 sites within a 4 mile radius of central London with one giving a sales incentive of stamp duty paid, when they mentioned headwinds in central London in their results (see BDEV board - figures above from memory).I don't think there is any question of reading the market short term, all reports are that central London prices have fallen at the higher end, while more affordable housing continues to roar ahead in the same area. Also badly hit by the stamp duty changes compared to the rest of the country, which may be revised next week.The Duke of Westminster's private fund sold some properties 15 months ago and were happy they had hit the top end of the London market, and they have over 900 years experience.You only have to measure the housing cycle from 2008/09 really, to have a good idea of where we stand. As for BKG specifically, its all about how well they've handled their balance sheet and their ability to sell to foreign investors during this current uncertainty and price correction period, something London is very used to. Many foreigners will be happy to snap up a high end London home at a perceived discount backed by a weak pound.There is also no doubt in my mind that at some point in the next few years, for several years, London property will rise in price outstripping the rest of the country in growth by far.Happy to hold a tranche here, but if I add again it will be at a price closer to @2300p than the last buy, thus giving more worthwhile room for a trade to lower my overall holding price which is now down to about 2320p (haven't had time to update my portfolio yet but it is something close to that after the small profit from the last trade has been applied). The days of buying BKG under @3000p and selling around @3300p are behind us for a while, I believe, but @2300 - @2530p looks like a more reasonable range for making a quick 10%.Meanwhile, if you want to invest in the housing sector long term, I would recommend PSN as best of breed in the sector for an investor, with pretty much a guaranteed 6% plus yield for the next 5 years and well positioned to source materials from within the UK from their own brick maker and materials fabrication factory, offsetting inflationary materials costs. No debt and a Billion pounds in cash on hand (I estimate) with a huge pipeline of sales, fantastic land bank and the lowest average price of any large builder shields them against interest rate hikes that may slow the mortgage market.Their geographic diversity means they still have room for growth this cycle too, especially if the government does push the 'northern powerhouse' concept in the Autumn statement. HS2 already going ahead, a major part of it.PSN do need to do something about their overall quality of finished build, which has slipped. I could handle that for them given a few months - and a quarter of a million of salary plus share bonus for quality levels (which isn't currently being paid). Why they've taken at least 2 years I don't know - no overall director of quality control I suspect. Falling to a 3/5 star housing supplier will be costing them money in remedial work, I'm sure.Which now means unique parts of my extensive research on the housing sector and PSN specifically now stretches across this board, the VOD board, and the PSN board itself. Good luck to all.
LK Hyman
20 Nov 2016
Re: Added Today @2400 Eadwig,"making only 131p per share profit."Bless!I admire your confidence in your ability to read Mr Market in the short term, so far as London high end property is concerned. You're a more confident man than I am, Gunga Din.Did you see that Barratt has dropped its high end prices by 10%? And Berkeley is a lot higher end than Barratt.That said, I'm keeping a weather eye out on BKG for a possible entry for a long term hold (as is my wont). That Pidgley feller ain't stoopid.Meanwhile, for the nonce, I'm restricting my listed involvement with investment property to National Grid and its JV with BKG's St William. That's enough of a walk on the wild side forLKH on the flybridge for the nonce
Eadwig
20 Nov 2016
Re: Added Today @2400 Eadwig, 10 Oct 2016 "Added Today @2400 "SOLD @2543 18 Nov 2016 Not much of a trade given that the divi date is coming up which is (probably) worth 100p per share, maybe more, and buying @2400p meant stamp duty of 12p per share making only 131p per share profit..Seems clear to me that @2400p was no longer a good .entry point for a quick trade, should have been something closer to @2350 or even lower with a limit order set to catch an intraday lower price.Not sure what caused Friday's rise, but I have so much exposure to housing and construction in anticipation of the Autumn statement and the white paper on housing coming up I decided to reduce my holding while I could. I'm still holding a single tranche here.No question that central London and higher end properties have been hit by stamp duty changes and Brexit fallout and that part of the market seems the least likely to be given any further help by government - I heard it rumoured that smaller companies rather than larger ones may be aided by the Chancellor, but that particular line hasn't been repeated recently.We shall see within a week or so, but I'm happy to reduce my exposure a little here. Having said that, if it drops to @2350p on Monday for no particular reason, I'd very likely be back adding to my remaining tranche once again. Good luck to all.
dazedandconfused
16 Nov 2016
Re: Times Article/BKG relevance Yep, it certainly shows up in Andalusia (where i am at present) if your monthly Co. pension is in UKP - having to go to more bars where tapas comes free with my CruzCampo...but my kids are all recent first time buyers in London (the last one, yesterday in Brentford); i get some REAL background market info sent to the Bank of M&D, and there's no pause in the 'small' home marketplace yet just a natural slowing down as buyers match sellers. Gonna hold BKG for a while more now, although Bellway (and GLE) was my better bet a year back.
Eadwig
16 Nov 2016
Re: Times Article/BKG relevance dazed&confused,Yeah, sorry to take up so much space with my personal Fx concerns. There are actually other investors about who live partly or wholly in Europe who must be having similar problems, but I'm not sure they're still in BKG at moment.Indirectly, the whole thing will affect BKG too, in that much of the skilled sector workforce is having to make similar calculations about the Fx rate - and no doubt some will take employment elsewhere in Europe where the economy is finally starting to pick up. Or was, I think the Trump election has thrown a few more doubts in the works.If you read the sector's full reports many of them are naming the lack of and potential future loss of skills as one of the major threats in their SWOT analysis, as it could result in less completions and/or high wage inflation [Take on some apprentices I say!].Same goes for many materials that are currently sourced abroad. This is actually a higher percent than we tend to think [than I did anyway]. Many come via UK wholesalers but they actually source the materials abroad and pass on the Fx costs.So, that's my excuse anyway - even if I hadn't previously linked the discussion directly with the sector. A bit selfish of me, but GBP weakness is likely to cost me much more than any impact it has on the housing market - but why would anyone care??Good luck to all holders here - Its going to be a bit rough for a while yet, but no matter what, people from all over the world are always going to want high end properties in London - so long as they're allowed into the country.If BKG maintains its dividend through the uncertain times, holders are always going to have a measure of protection. Does anyone believe the divi is under threat?
Eadwig
16 Nov 2016
Re: general divvent,BDEV's report was always going to affect BKG - also PSN which has very little exposure to the south east. I've made comments on both boards. PSN, for me, obviously in the strongest position going forward in this climate, although marked down with the sector today.I know what you mean about holding back on price weakness in central London - although in a 4 mile radius of central London BDEV has several sites with few available properties and only one has additional incentives (stamp duty paid) in NW3 if I remember correctly ...BUT ... I'd also be holding back to see what the Autumn statement says next week. Lobbyists are attempting to have some or all recent stamp duty changes wiped out. I don't think they'll be wholly successful, but I bet there is some tinkering, especially to do with buy to let. But we'll soon see.
divvent argie
16 Nov 2016
Re: general From HL on BDEV:- One of Britain’s biggest housebuilders has started cutting prices on some of its most expensive London homes because of waning demand at the top end of the market.Barratt Developments said that although overall market conditions were healthy because of good mortgage availability and a shortage of homes, the top end of the market in the capital was challenging.David Thomas, chief executive, said: “Market conditions in London at higher selling prices remain more challenging. To mitigate these risks we have taken pricing action on a number of our sites in London.”Guess that explains todays fall. Once prices begin to drop and with Brexit uncertainty creeping in its anyones guess where the BKG sp will go. If I was thinking of buying in central London and saw evidence of price weakness I'd hold back especially if I was only motivated bu investment returns rather than living there. Glad I got out recently - this is back on my watch list.
