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Taylor Wimpey PLC TW.

Morningstar Rating
GBX 156.65 +0.60 (0.38%)
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Company Report

UK Homebuilders Remain Attractive Despite Positive Stock Price Reaction to Labour Election Victory

We reiterate the still-significant stock price upside potential for the majority of our UK homebuilder coverage despite the positive homebuilder stock price reaction to a Labour Party victory in the UK general election. Indeed, the election result was widely anticipated given polling in the lead up to the UK general election, which predicted a landslide Labour victory. Nonetheless, the election outcome has emboldened investors, with UK homebuilder stocks leading gains in UK stocks in early trading following the election result on July 5, 2024. Ostensibly, the Labour victory has instilled greater investor confidence that the present urban planning bottlenecks to new housing supply will be appropriately addressed—a key near-term concern that has weighed on UK homebuilder stock prices. Labour’s plans to reinstate support for first homebuyers and to increase supply of other forms of affordable housing are also constructive to the homebuilder industry outlook.

Price vs Fair Value

TW. is trading at a 819% premium.
Price
GBX 156.05
Fair Value
GBX 163.00
Uncertainty
High
1-Star Price
GBX 384.70
5-Star Price
GBX 736.00
Economic Moat
Gpdr
Capital Allocation
Pzgjpch

Bulls Say, Bears Say

Bulls

Underlying housing demand is likely to benefit from the UK’s changing demographics. The ongoing ageing of the population is likely to support demand for new housing over the coming decade as the UK's average household size declines.

Bears

The UK government’s annual target of 300,000 new home additions is unlikely to materialise, with housing market data not indicative of a material undersupply.

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News

Trading Information

Previous Close Price
GBX 156.05
Day Range
GBX 156.05157.58
52-Week Range
GBX 102.25158.44
Bid/Ask
GBX 156.50 / GBX 156.65
Market Cap
GBX 553.99 Bil
Volume/Avg
2.8 Mil / 12.4 Mil

Key Statistics

Price/Earnings (Normalized)
15.43
Price/Sales
1.57
Dividend Yield (Trailing)
6.14%
Dividend Yield (Forward)
6.14%
Total Yield
6.14%

Company Profile

Taylor Wimpey is the UK’s second-largest residential property developer by revenue—or third-largest as judged by dwelling completions—and was established via the merger of George Wimpey and Taylor Woodrow in 2007. Taylor Wimpey is vertically integrated through the land development, construction, and sales and marketing segments of the residential property development value chain, aligning with the typical business model employed by UK homebuilders. The company also has a nascent homebuilding operation in Spain.
Sector
Consumer Cyclical
Industry
Residential Construction
Stock Style Box
Mid Value
Total Number of Employees
4,618

Competitors

Valuation

Metric
TW.
BDEV
BKG
Price/Earnings (Normalized)
15.4312.1711.82
Price/Book Value
1.220.891.46
Price/Sales
1.571.122.14
Price/Cash Flow
16.0523.0915.54
Price/Earnings
TW.
BDEV
BKG

Financial Strength

Metric
TW.
BDEV
BKG
Quick Ratio
0.790.860.64
Current Ratio
5.374.923.57
Interest Coverage
18.497.1723.08
Quick Ratio
TW.
BDEV
BKG

Profitability

Metric
TW.
BDEV
BKG
Return on Assets (Normalized)
5.48%4.95%6.78%
Return on Equity (Normalized)
7.74%7.02%13.98%
Return on Invested Capital (Normalized)
7.47%6.74%11.33%
Return on Assets
TW.
BDEV
BKG
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