That looks exactly like my portfolio, only opposite!
How come persimmons is blowing up? Have they just got a big new contract or something?
I honestly have no idea why it’s up so much. I bought in for the large dividend it pays (12%) so I won’t be selling anytime soon.
The housebuilders are up following the vote as it means brexit is most likely going to be delayed and the threat of a no deal is looking less and less likely. They all fell a lot last year, so the share price is recovering…
I started buying Taylor Wimpy in tranches thinking it might fall further a bit more but now after my first tranche it looks like it’s largely recovered. So I’ll probably hold off on adding to my position for now…
Sounds good to me, I was thinking of putting some money into persimmon or taylor wimpey. Especially down in South Wales theres new housing estates popping up every day
When I first considered Persimmons I read that they have so much work there’s a backlog. The population is rising considerably so I imagine there’s a great need for new housing.
@Flatking its largely driven up by the overall sector. The housing market is very cyclical so the whole sector was driven down by the potential Brexit impact and the fact that we are getting late in the cycle and forward orders might slip. Some of the big housing builders have now come out and reaffirmed 2018 numbers and cautiously said 2019 will also be good.
For disclose I have a huge position in Taylor Wimpey over the years & I believe this is a much better bet than Persimmon. Persimmon has had a number of executive related issues this year (not just the fat cat pay scandal of their old CEO), they have a limited landbank when compared against their peers & finally they have an arguably suicidal dividend policy that will ultimately disappoint investors - they simply cannot maintain that dividend through the cycle. Conversely, Taylor Wimpey is conservatively managed, invests the most of all of the builders in its landbank and distributes profits through a special dividend each year, leaving their normal dividend very payable throughout the cycle. Taylor Wimpey also has the highest satisfaction numbers, highest employee engagement scores and the 2nd lowest costs. All of that said, Persimmon is the biggest for a reason, their margin is the highest (for good reason) and they are one of only 2 house-builders with zero long term debt - to be clear, I believe Persimmon is a good bet, I just think TW is better.
Wider economic point on UK homebuilders - we build about 60% of the homes we need each year. Whilst this is an estimate, even a bad estimate would assume we are falling behind each year. Combined with Help-To-Buy being extended to 2023, there is plenty of market support for these guys to carry on (there is one builder that is heavily indebted, I forget which, probably best for everyone to avoid this one).
On this thread subject though, I’m back in the green on my Freetrade account which is very pleasing to see with Taylor Wimpey, Tesco, HSBC & OneSavings Bank leading me nicely into the future
Thanks for taking the time to talk me through all that, I had an idea it was to do with brexit but I thought a 20% swing must’ve been something else in the works!
Glad to hear you’re in the green!
Anytime, I like to provide a bit of analysis. Thinking of starting a site dedicated to it, for the average person, not the Wall Street & City fat cats
You already started it up there ^ a couple of posts . And here might be a sensible place to continue because it comes with a small but engaged audience.
Maybe. I need to be careful though, I’m not a qualified financial advisor - appreciate that though!