www.trafalgar-new-homes.co.uk

Just had a small punt on these earlier - look promising, but dyor etc.



RNS Number : 4070J
Trafalgar New Homes PLC
16 July 2013
Trafalgar New Homes PLC
("Trafalgar New Homes", the "Company" or "Group")
Admission to Trading on AIM
Trafalgar New Homes, the residential property developer operating in southeast England, is pleased to announce today its admission to trading on AIM. Dealings of the Company's ordinary shares of 1p each ("Ordinary Shares") commenced at 08:00am this morning ("Admission"), under the ticker TRAF.
Key Points:
-- Trafalgar New Homes is a residential property developer focused on Kent, Surrey, Sussex and the M25 ring south of London.
-- The Group specialises in small developments and outsources the design, planning and construction to third party contractors on a fixed price basis.
-- The Board believes the Group occupies a niche position in the current market, between local builders and developers and the larger house building companies.
-- The Company has raised GBP280,000, before expenses, through the issue of 14,000,000 new Ordinary Shares at 2p per Ordinary Share in a placing.
-- On Admission the Company will have 228,375,190 Ordinary Shares in issue giving it an approximate market capitalisation of GBP4.6 million.
-- The Directors expect the audited results for the year to 31 March 2013 to be announced in August.
-- Allenby Capital Limited is acting as the Company's nominated adviser and broker. Christopher Johnson, CEO of the Company, commented: "It has always been our intention to move to AIM at an appropriate time and the Board believes that the Group has made sufficient progress such that the move to AIM is now the logical next step. We have a continuing commitment to provide quality homes at realistic prices in the most sought after locations. We are excited with the prospects for the Company and look forward to maximising returns for our shareholders."
For further information and a copy of the AIM admission document visit www.trafalgar-new-homes.co.uk or contact:

doodlebug4

future prospects have to come with figures and today's results are not to scratch.

do not ask me, ask the directors why the figures are not better.

I hope you do know how to calculate at least the PE?
maybe there is asset value on the stock, but they did not reported.

ontheturn - I'm not sure what you are talking about when you say the "results are not to scratch". Not up to scratch in your opinion? Having worked in the banking industry for 18 years I do know how to calculate PE and I also understand company balance sheets, however I don't buy into a share based only on the fundamentals. I usually take several factors into consideration before buying a share and if I look at the factors now that I considered before buying into TRAF then I see no reason to sell. There is nothing in the Interim Results announced today to make me think the story has changed. The Chief Executive also seems to be confident that planning will be granted for the Staplehurst development.

doodle

you are saying nothing but talk talk and talk, just give figures and reasons.

your banking background says nothing to me ( maybe you better did not mention it ) there is good reasons to say those working on this areas know nothing better than loose money for client and themself ( a bit of a joke but true)

Yes my opinion, but I give figures and why, about time you do also if you want me to aswer any more.

I am only saying what I see on the figure compare with share prices lately

ontheturn - I'm not here to try and persuade you, or anyone else, to buy this share! You obviously have done your own research into this company and don't like what you see. We can just agree to differ. :-)

But...

I am still wating for you numbers and reasons to make you buy the shares earlier at much higher prices than now

Jam tomorrow is not good enough for me or for any investor when there are so many undervalued companies ( low share price does not mean undervalue just plenty of shares on the market cap)

ontheturn - here you go, some numbers & reasons for you - just for starters. If you would like another 20 pages then just ask.:-)


Trafalgar New Homes plc (TRAF)

Valuation and conclusion
A size-related valuation discount to its peer group is to be expected, although we would make the point that in our opinion the highly focused nature of the group’s operation on the South East region of the UK where housing demand is high and supply relatively limited and its policy of outsourcing construction and legals, might suggest that the business model is possibly less volatile than that of its peers.
Exhibit 7: Valuation comparatives for a selection of quoted housebuilders
Source: Consensus forecasts – Hemscott; Allenby Capital forecasts
Priced intra-day 15 July 2013
Conclusion
The residential housebuilding sector has been outperforming the general market for the past eighteen months and since the beginning of 2012 the share prices of the above companies have increased by an average of 185%. Much of this improvement has been generated by government initiatives designed to kick start the housing market which now appears to be succeeding. Clearly TRAF, with a market cap of £4.6m, is a minnow compared to the £1.4bn average market cap of the sector, however it is exposed to one of the UK’s major housebuilding hotspots, South East of England, and its model is substantially de-risked by its outsourcing of the design and build process.
By any valuation measure the shares are attractive, even after applying a 25% size-based discount to the shares and in addition offer a prospective dividend yield of 3.3% for the current year to March 2014, which is higher than any offered by its peer group aside from Persimmon which is currently in the process of distributing surplus capital back to its shareholders and as such the prospective yield is unlikely to be sustainable.
Fair value set at 4.5p
We believe initial fair value should be set at 4.5p, a 125% uplift from the current share price, which would still only put the shares on a PER of 9.4x for FY 2014 and 8.2x for FY 2015 indicating discounts of 52% and 46% respectively to the sector averages.PriceMarket Company(p)Cap (£m)Y1EY2EY1EY2EY1EY2EY1EY2EPersimmon1,302 3,953 68.082.719.115.775.095.05.8%7.3%Taylor Wimpey107 3,463 5.77.018.815.31.21.51.1%1.4%Barratt Developments351 3,438 14.623.024.015.32.24.50.6%1.3%Berkeley Group2,320 3,045 170.0182.013.612.735.038.01.5%1.6%Bellway1,445 1,759 83.0100.017.414.525.030.01.7%2.1%Bovis Homes854 1,145 40.550.021.117.112.015.01.4%1.8%Crest Nicholson362 911 24.529.014.812.54.17.21.1%2.0%Redrow244 903 13.017.018.814.41.52.50.6%1.0%Telford Homes319 186 20.222.815.814.07.08.22.2%2.6%Gleeson (MJ)349 184 8.912.939.227.11.31.40.4%0.4%Abbey750 161 44.050.017.015.08.08.51.1%1.1%Inland Homes30 60 1.8n/a16.7n/a0.1n/a0.3%n/aMar City12 39 0.81.216.010.0n/an/an/an/aAverage1,481 19.415.31.1%1.5%Trafalgar New Homes2.04.60.480.554.23.60.0650.0753.3%3.8%Note: The yield on Persimmon relates to the company's Capital Return Plan which aims to return a total of £1.9bn of surplus capital to shareholders by 2021TRAF Yr1 and Yr2 refer to years ending March 2014 and March 2015 respectivelyEPS (p)PER (x)Dividend (p)Yield (%)
Housebuilding stocks have risen by 185% since the beginning of 2012
An attractive valuation by any measure
Initial fair value set at 4.5p offering 125% upside.

Allenby Capital.

.

any one can copy and paste ( and next time try to do it a bit better I do not like to see/read - jargon -) that was from July when the stock came to market @ 2p.

do you own home work

otherwise I will believe my early thought I am talking to a beguiner with not much idea of valuation

ontheturn - I did my own homework and part of it was reading this broker's note! I don't know what a "beguiner" is, but, just guessing what you are trying to say, I have been trading shares since 2003. When I have an up-to-date re-assessment from Allenby Capital I will post it on this thread - meanwhile, with respect, while you are not impressed with my maths I am not impressed with your lack of command of the English language. :-) Next time try to do a bit better!

Up 12% today, following on from Friday's 11% gain.

To top for management.

Interest rates will stay low until Britain enjoys a prolonged period of strong growth, a Bank of England policymaker has said in a speech indicating that historically cheap credit will remain in place well beyond next year.

Spencer Dale, the Bank's chief economist, said the weakness of the UK economy and the threat of further shocks to the world economy meant Threadneedle Street would want to see a combination of strong growth, low unemployment and rising incomes before raising rates.

His trinity of targets is likely to be welcomed by mortgage payers given the flurry of reports that the Bank will be forced to raise rates next year to calm the current growth spurt.
The likelihood is that while growth has already begun to accelerate, wages are unlikely to begin rising above the rate of inflation until 2015 and only consistently by 2016 when the Bank expects unemployment to fall to its target of 7%.

Addressing a group of business leaders, Dale said the recent optimism could not be taken for granted.

"Events of the past few years may colour and contaminate business behaviour for many years," he said. In particular, he suggested that "the reluctance today of some companies to borrow from their banks may be less a lack of demand and more a breakdown of trust", which adversely effects "the efficient functioning of our economy".

His comments echo the stance taken by the Bank's governor, Mark Carney, who has dismissed concerns that it would need to respond to rising house prices with higher rates.

Dale said the housing market had a tendency to behave like a microwave, "turning from lukewarm to scalding hot in a matter of a few economic seconds", but argued that the central bank is "far better equipped to respond to these types of risks than in the past".

To counter underlying fears among many business people, who have proved reluctant to invest in new equipment and technology since the financial crash, interest rates must remain low.

Dale said: "You can plan for the future in the knowledge that the MPC [the Bank's monetary policy committee] intends to keep interest rates low until we've seen a prolonged period of strong growth, unemployment is significantly lower, real incomes are higher."

He added that his best guess is that such conditions for raising rates remain "some way in the distance".


The Guardian.

Plot 12 ( £650,000 ) at Oakhurst Park Gardens now sold STC.

TRAFALGAR NEW HOMES PLC ORD 1P 3.38 -6.89%

The over valuation did not last, low of the year

I've sold out of these for the time being - it's like watching paint dry here at the moment. I'm usually quite patient with shares, but there is a lack of newsflow from the company at this time of year when the house sales should be perking up. The Combe Bank Homes website isn't updated regularly, which suggests sloppy business practice to me.

Not much happening on the website.

My fault folks for buying a few these - maybe they may sell a chimney pot soon!! Why does everything I touch turn to lead?

3 monkies - I've just had a look at the Combe Bank Homes website and it has been updated to show 3 properties are now sold and 3 are sold STC, so at least that is an improvement!

Cheers doodlebug4., may we await a brick or the letter box being sold next. One has to try to have some sort of sense of humour.!!!!

Take a look at MAR thats a proper housebuilder.