Inland Live Discussion

mcescher 28 Mar 2016

Valuation and growth of Inland Homes What do people think of this DCF for INL? [link]

Eadwig 10 Jan 2016

Re: P/E (again) Eadwig 3rd Jan 2016:"I'm half expecting an across-the-board correction on the markets in January, or certainly sooner rather than later in 2016. INL is very much toward the top end of my shopping list, even if it would mean averaging UP yet again."Well, we've had a horrible opening week, and that correction has happened, but the INL price has stood up amazingly well, as have a lot of the smaller construction companies.The larger ones have been pulled down, but probably due to funds selling the whole of the FTSE 100 or 250. PSN reported decent results in the middle of last week, although not quite as stellar as the previous few years, I thought.I think the markets will drop further yet, but I'm not sure I am going to get a chance to pick up INL shares on the cheap after all. Same with ESP, who are alongside INL at the top of my shopping list.Possibly, the correction has actually held the sp down. Possibly it has been supported by money taken from other sectors, maybe Cameron's new year speech making housing a priority and appearing to suggest measures for an extra 13,000 homes spread around the smaller builders has had an impact. Very difficult to say. I'm not going to buy at this price (@88.12p), but I might just end up regretting that decision.

Eadwig 03 Jan 2016

Re: P/E (again) wineberry:"The P/E of 5.9 is incredibly low"It is, but it is partially an accounting anomally - but only partially. However you work it, it is still well under 10 as far as I can see. I look on INL as a late bloomer in the sector, although those who bought at @20p in 2011 may well think it is I who am the late bloomer.The point is, INL, compared to the rest of the sector, took off a lot later than most of the rest of the sector, and has had long sideways moves in-line with the sector too. In percentage terms, I think INL has much more potential growth than the likes of Eg. BDEV, which I was buying for @69p in 2011 and in which we have seen a >900% rise. Even those lucky enough to buy INL @20p have not seen that kind of return. Yet.Also, the P/Es of other builders, which in the past would have been sky high in the middle of such a bull run, are actually clustered around the FTSE average. BKG is 11.9, BDEV 13.8, PSN is about the highest at 16.6. I think the FTSE 100 long term average is about 15..In other words, if you expect them to keep up similar performances, then their P/Es in the out years, Ie, the years ahead, are unbelievably small for companies that can justifiably expect some reasonable growth, if not great growth, for at least another 3 years. Certainly they are all are expecting to increase sales and profits next year.Normally markets would price that growth in and the share price would reflect their assignation of a much higher multiple, as indeed BDEV was for a while, well into the 20s.But earnings have caught up without very much sp growth which now means these companies like BDEV, BKG etc, with yields of over 5% even at current prices, are fantastic investments with no high risk of the market bombing the share price over-night in the event of the odd interest rate rise etc.Compare this to ARM holdings, with a P/E of 48, for example, which gave a return of about 6% on its stock price over 2015 and has a yield of 0.82%. ARM is a company that has to constantly keep ahead of the competition to make its sales, and has a great track record of doing so. However, there is absolutely no guarantee that it will still be ahead in 2 or 3 years, whereas housebuilders look very well set for at least the greater part of the term of the current UK government.Probably the worst that could happen with INL in the short term, is they get a take over offer the board can't refuse and we all get paid a large premium for our shares - but not anything like as large than if we'd been able to hold onto the shares for another 2 or 3 years.Today's share price is @86.5. I would not be at all surprised to see that @150p-170p this time next year with just as good a growth forecast for company operating results by management for 2017 as they have given for 2016.I'm half expecting an across-the-board correction on the markets in January, or certainly sooner rather than later in 2016. INL is very much toward the top end of my shopping list, even if it would mean averaging UP yet again.

wineberry 03 Jan 2016

P/E The P/E of 5.9 is incredibly low. Have a look at the other quoted builders.

Eadwig 03 Jan 2016

9th best 2015 AIM performer According to the Telegraph of 2nd Jan 2016, although their AIM list doesnt appear to include all AIM companies by any means.It gives INL 2015 figures as a share price rise of 45.4%, a yield of 1.2% and a P/E of 5.9 (five point nine). Taylor Wimpey came in as the top FTSE 100 performer in their 2015 Winners and Losers list with Barratts 3rd and Persimmon 8th.[link] discussions about construction performance I wrote this about INL on the BDEV board:Might I also add, Inland Homes, one of my STRONG BUY recommendations this year as a 'late comer to the party', is placed as 9th best overall AIM performer in the Telegraph' list. (I'm not quite sure about their selection criteria for that particular list. Whether winners or losers, there are some very obvious ommissions from the Telegraph table printed in the 2nd Jan edition).INL are shown in this list with a 2015 rise of 45.4%, a yield of 1.2% and a P/E of 5.9 (five point nine)."For the curious, INL have an interesting diversification within the confines of the construction sector. While only completing approx 240 homes (from memory) in their last full year trading statement, they are brownfield specialists with a land bank of over 5000 plots (over 1000 with planning permission).That is because they also make money through consultancy on gaining planning permission as well as selling land bank plots that they have achieved planning permission on.Another intresting twist is that when they sell a group of plots for development, they often retain an area for themselves for building, Eg. a convenience store to service the occupiers of the new development. They then rent out that store and have fast growing revenues from this aspect of the business, often based on long term leases. I believe local convenience stores are going to be a growth area over the next few years as the super-supermarket model appears to have fallen foul of many shoppers.The other reason I gave for liking them to mitigate the fact they are a relatively small AIM company, is that the board of directors own approx 25% of the share capital between them. This fact couples with the relatively low dividend yield suggests to me that they have great belief in the future of the company.I don't have any hesitation in recommending them again for 2016. I should say that I am currently a holder (if you hadn't guessed) and that if I were buying more I would hope to get in at a better price than the current @86.5p per share [so take that into account with my STRONG BUY recommendation and also that all my figures regarding INL, other than those printed in the Telegraph, are from memory only].I also hold PSN, BKG, TEF in the sector and ESP, which has at least one foot in the sector. Please do your own research if any of the above interests you. "

Eadwig 24 Dec 2015

Re: sold Same director, the CEO, sold @67.37 about a month ago causing a dip to around 63p which turned out to be a fantastic buying opportunity. The CEO still holds a sizeable percentage of the company along with other directors.

coldascheese 24 Dec 2015

sold Have sold my holding today as I considered after dir selling that maybe share price had got ahead of itself after a great run.They may have a greater asset value finally but I can't see this being realised in the short term as building takes time-so maybe one or two years to get there and in that time share prices will be up and down. Might get back in on the dips.

Eadwig 21 Dec 2015

Re: purchaser Is the purchaser identified fully? The employee trust appear to have upped their holding by 50% or so, paying just about as high a price as possible, 87.7pps, as an *average*. I wonder if this shows extreme confidence in further rises or they were constrained by the dates on which they had to buy.Either someone else has been purchasing heavily previously, (the high volume day was around a price of 76p) or there simply weren't enough shares in the open market to make up the purchase and this ended up being the negotiated price (you couldn't have bought over several days for an average of 87.7p in the open market - see chart below). This is very good news for us shareholders, assuming there isn't a very large volume of profit taking tomorrow.Perhaps someone else has a different take on proceedings? From the RNS below:"INL was notified today that on 21 December 2015, Equiom (Guernsey) Limited, as Trustee of The Inland Homes PLC Employee Share Ownership Trust, (the "EBT" purchased 377,500 ordinary shares of 10 pence each ("Ordinary Shares" at an average price of 87.7 pence per Ordinary Share. Consequently, the EBT now holds 1,027,500 Ordinary Shares, representing approximately 0.51 per cent. of the Company's issued share capital."As usual, I was toying with the idea of buying more not so long ago. After today I've been wondering if I should sell half my holding for some quick profit, re-buying on any pull-back later, either due to profit taking or as part of a general market pull-back.I've decided to hold. I think INL are in a very sweet spot going forward and I would feel silly taking 20-25% profit now and then failing to get back in again later on what I think could be a late-to-the-housing party multi-bagger (or at least a double for me as a late entrant, anyway).

wineberry 21 Dec 2015

Re: purchaser All is revealed - it's the trust looking after the Employees Share Ownership scheme. This is still a superb and under-rated (& under many investors' radar) company even after the share price rise; low PE of approx 6.5 although the dividend cover is only 1.4, using the stats published in "fundamentals". Very happy holding whilst the housing cycle is so strong.

David116 15 Dec 2015

Re: I wonder who the purchaser is At the AGM, we were told that the buys were "an institution".

Eadwig 12 Dec 2015

Re: I wonder who the purchaser is Yes, that was some serious volume (see chart below).It does show confidence, as you say, which I'm pleased to see because I thought that the new government schemes play right into INL's hands, both for their own builds, their brownfield consultancy and their land bank sales.So long as management stays steady, it is hard to see how they lose from here in the short to medium term. I wont try and make any long term predictions in the UK housing market.I give a strong buy (again) for anyone not holding, although if I were to add to my own holding (which has a high average as it is) I think I would wait for a pullback from these heights. Perhaps another director could unload a few hundred thousand shares. That seems to do the trick. Currently @75p, I have a limit order set @65p just in case the above does happen. If not, I have two decent[-sized tranches going forward anyway.

serious lnvestor 11 Dec 2015

i wonder whom the purchaser is today. Between 10.47 hrs and 11.53 hours their were large purchases of shares3 lots timed at 10.47 hours totalling 3,350,000 shares1 lot timed at 10.54 hours totalling 2,000,000 shares 1 lot timed at 11.08 hours totalling 500,000 shares1 lot timed at 11.53 hours totalling 250,000 shares equalling 6.1 million shares.It shows confidence in Inland Homes. s.

lawdoc 04 Dec 2015

Re: AIM: IHT I have also made the IHT assumption on INL but it would be good to know for sure.For what it's worth, psinker, a contributor on LSE has confirmed IHT on ARBB:"I was an executor for a deceased estate in 2014. We were granted Business Property Relief by HMRC on the ARBB shares so that no IHT was paid on that holding."

Eggbaconandbubble 03 Dec 2015

Re: AIM: IHT Best way to find that out is call Inland and ask to speak to Investor Relations. They should know!Failing that try the London Stock Exchange.

ookyfly 02 Dec 2015

AIM: IHT Does anyone know if INL qualifies as an AIM company for exemption from iht once one has held them for two years? (My assumption is that it does.)