I have previously explained why I like Balwin Properties. They had a voluntary trading statement that was very much in line with my lofty expectations. Of course, companies only make voluntary trading statements, when the news are good, but this one really had the desired effect. The share price spiked by over 11% as people realised they might have this company wrong.
BWN did not, like many other companies, comment about pressurised consumers, difficult economies and political uncertainty. Rather they focussed on the solid demand for their developments and the success of their strategy, which has led them to start their first development in KZN, in Ballito.
I am convinced this company has plenty more steam and phenomenal long term fundamentals. At the earnings forecast in their trading statement, the company is trading at a PE of 6.3. With BWN’s stated strategy of distributing approximately 30% of earnings as dividends, the shareholder can currently expect a dividend yield of 4.7%. At these levels, I see at least an 80-100% upside in the share price and I am comfortable to collect the juicy dividends while I wait for this to materialise.