Ben Bailey PLC (Housebuilder).
The Mail today said to buy Bellway as they looked very cheap. BBC is cheaper still and is constantly overlooked by analysts.
I am lucky enough to have been in this one for years, and as 2005 started, it hit 500pps. After interims that said it was affected by the slowdown in the market, and the general malaise in the housing market, it has plummeted by 30%. But is this overdone?
The basics make it look very cheap. Trading on a P/e ratio of 3.508 as compared to Bellways ratio of 6.279 it has a similar dividend yield (3.198%). Having read the investors reports it appears the market did overreact, as hidden behind the headline of being affected by the market slowdown was an increasingly large landbank and a move away from their traditional stock of 3 and 4 bed detatched homes and into semis and townhouses, to increase the margin on the land they own.
Further to this, they are specialists in brownfield development, which the government is known to favour and operate solely in the north of England, where the housing market has been less affected than elsewhere.
January sees the year end results posted, and with all the above taken into account, as well as the predicted housing crash not happening, I see a return to the higher sp levels of late 2004 / early 2005. Add into this a 15pps dividend and I see a winner, both short and long term.
Thoughts anyone?
Alan

And I thank you for it.
I am returning one soon.
Alan

Half right, half wrong.
No pre-close statement today, but 6 well and truly breached.

Last possible day for a pre close statement and no sign of one.
Read into that whatever you will, but its been a good year with a very strong finish.
Dead happy.
Alan

al, well done mate, seems like you have had a good year.

I have bought some fum over the last week or so.

Defo worth a look imho.

Happy new year and good luck for 07 ;-)

And to you, Leggy.
I've only had one little flutter over the last few weeks.
Have a squint at PDR. Not everyones cup of Assam, but I fancy it!!
Alan

Anyone heard any news on a potential takeover bid? I presume the interest rate increase had an impact today?!!!
Simon

I've heard none, Simon. These are a notoriously tight lipped company but they have done very well for me over the years so I aint complaining.
And yes, the rate rise shocked it down a bit but I fancy it will still do well. Traditionally, if you like to trade, March is a good time to sell these and October to get back in, so expect a drop over the summer.
Alan

Should I be keeping hold or selling? Big drop today for some reason?
Thanks

Don't know is the short answer!!
They usually start to fall on results day and then pick up late in the year, so this is a bit early.
I think its just a general malaise on Interest rates and inflation fears.
Alan

Twas a nasty correction, but it seems to have bottomed and be going in the right direction again.
Alan

Went well today. Anticipation of good results? Or, sector consolidation hopes?

Either way, not grumbling.

A good week in fact (so far).
I think it will trace its historically predictable path of peaking around results day and the gently heading south for the summer, but the chart (to a non chartist like me) suggests differently.
Alan

?

Strategic review = could sell itself.

Or an MBO (unlikely).
Bring it on.................

I don't see an MBO, either.

My view; very likely accept a bid.

WMPY are looking for acquisitions.

Alan - well done on this - I have watched this since you mentioned it at about 3 - and I always thought it was due a correction, too good to be true and I just knew that as soon as I invested it would go down - so I never actually took the plunge.

Well done you - u always said it had legs - and so it seems

Baza

Thanks Baza. You know the story on this. I am actually emotionally attached to this as the first stock I ever bought at the princely sum of 50p, but at the 3 stage it really was way undervalued.
alan

Current EPS are 74.5p (2005). If we assume this years results next week show similar (and why not) what kind of multiple do we think would be reasonable as a for sale figure?
Currently trading at about 9 and a half PE ratio, this still looks a tempting buy for a private equity group and the increase in land bank over the last couple of years may tempt the Wimpeys and Barrats of this world.
Anyone fancy a guess at a "for sale" figure??
alan

My guess: 800p.