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

Fingers crossed, Partridge.(For KIE as well)
Alan

Well 2 weeks since this thread started and we've seen a rise of about 12%.
Will it go further? I think so.
Will it go in a straight line? I doubt it, nothing ever does.
Where is it going tomorrow? Your guess is as good as mine. Probably better, but the day finished stongly, as it did on Monday, and thats often a good sign.
Alan

Another good strong day. It's a boring old share, this, cos the news flow is nil, so unless there is anything dramatic, I'll drop the daily commentary.
Still think theres a good few miles left in it, but as it has risen so well in the last couple of weeks, I think it will drop off for a week or so before starting a year end surge.
Anyway, I'm bored of talking to myself.
Alan

I also think there are a few miles left in it, maybe up to 440p before some consolidation. When does it go ex-div? As it seems to be repeating last year's pattern on the chart I intend to hold into the new year. Good spot Alan.

Its repeated it for the last 2 years now, Suth. I've held for about 8 years now, and what started as my first ever share, and a speculative punt, has become a lovely divi payer for me!
Back in a mo with the ex divi date.
Alan

Doesn't go ex divi till April next.
Alan

PS,
Nice to know I'm not on my own with this one. 8-)

I bought them following your earlier posting and my investigation on this and the sector in general. Looks like it may be one to move in and out off if predictability holds and take some capital as well as good income from it; that is, if it isn't taken over first. Will keep you posted on what I do with BBC.

She moves again!!
SSSHHHHH!
Lets keep it our little secret!!8-)
Alan

Alan - KIE just about keeping up with you!

Partridge,
I think we're due a pause, while you catch up.
Keep the faith.
Alan

Partridge,
Have you caught up yet?
Can we get going again now?
Pleeasseee?
Alan
;-)

KIE comfortably ahead if you look at last 3 months, but you just have the edge on one month (by my crude calculations about 12% against 10%). KIE AGM due shortly and I hope for positive spin to put me ahead before Xmas!

Best of luck to you, partridge. I would be very happy if you made 1000% by xmas, providing I only lose by a short head!!!
Alan

Just had a look at Telford homes.
Good interims this morning, saying that even in the SE house prices haven't crashed as predicted and it is recording another record year.
This company is trading on a P/E of 8.176 as opposed to BBC under 4 and it has 150% gearing.
Still think BBC looks way too cheap, and the run up to the year end will see it rise a good bit further.
Alan

And another one reporting today. Crest Nicholson. Everything looking rosey, sp rising on results and a P/E ratio of 7.849.
In this season of housebuilders reporting, the message seems to be; "Hey guys, it aint as bad as we thought it might be".
Gives me great confidence that as focus turns towards BBC year end (31/12) this will rise in anticipation and again on publication.
Alan

Not a lot of volume on BBC, but I think the MMs will push it up to reflect what else is happening in the sector, which seems pretty rosy as Crest numbers indicate. Hopeful therefore for continuing rise in SP into the BBC year end and with some even modest activity it good jump nicely.

It also appears today that McCarthy & Stone have bought a load of their own shares. I know they aren't quite the type of housebuilder we are talking about here but it is another sign of the entire sector being undervalued. The trick, as always, is to find the most undervalued!! That is why I harp on about the P/E ratio and the divi yield of 15pps.
Alan

As I have written previously, I believe this share to be predictable over 12 months, and the last three years charts are almost a copy of each other in the timing of rises and falls and the angle the chart climbs and drops.
Between end Nov 2003 and Feb 2004 there was a rise of about 30%.
Between end Nov 2004 and Feb 2005 there was a rise of about 30%
I do hope that the predictability continues. That would target holders for a price of about 540pps.
Heres hoping it is as forecastable as it has been for the last few years.
Alan

Alan - thought KIE AGM comments might spur them ahead of BBC. Chairman's statement roughly translates as "things are going stonkingly well" and the shares drop a few pence. Funny old game, but I still expect both to do well over coming months.