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1. Company Snapshot

1.a. Company Description

Taylor Wimpey plc operates a residential developer in the United Kingdom and Spain.It builds and delivers various homes and communities, including apartments to six-bedroom houses.Taylor Wimpey plc was founded in 1880 and is based in High Wycombe, the United Kingdom.

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1.b. Last Insights on TW

Taylor Wimpey's recent struggles can be attributed to a £222m fire safety hit, which led to pre-tax losses of £92.1 million for the six months to June 29. This significant financial burden, combined with a challenging UK housing market, has weighed on the company's performance. The UK housing market itself is experiencing a slowdown, with asking prices being cut by an average of £10,000, and rental listings falling sharply. Additionally, the company's removal from the FTSE 100 index may further impact investor sentiment.

1.c. Company Highlights

2. Taylor Wimpey Delivers Solid 2025 Results Amidst Challenging Market Conditions

Taylor Wimpey's 2025 financial performance was marked by a 13% increase in revenue to £3.84 billion, driven by a 6% growth in completions to 10,614 homes in the UK, excluding joint ventures. The company's gross profit stood at £658 million, while adjusted operating profit was £421 million, reflecting an adjusted operating margin of 10.9%. Earnings per share (EPS) came in at £0.0456, in line with analyst estimates. The company's return on net operating assets was 11%, indicating a stable operational performance.

Publication Date: Mar -06

📋 Highlights
  • Revenue and Profit Growth:: Revenue rose 13% to £3.84 billion in 2025, with gross profit at £658 million and adjusted operating profit of £421 million.
  • Completion Growth:: Delivered 6% growth in completions, achieving 10,614 UK homes (excluding joint ventures).
  • Shareholder Returns:: Declared a £0.0295 final dividend and a £52 million share buyback, maintaining a 7.5% NAV distribution policy.
  • Planning Reforms Impact:: 28% increase in detailed planning for over 10,000 plots, with 49% of planning officers expected to recommend assertive applications positively.
  • 2026 Guidance:: Anticipates 10,600–11,000 UK completions, £400 million adjusted operating profit, and £30 million pre-exceptional net finance charges.

Operational Highlights and Outlook

The company's operational performance was characterized by a UK average selling price of £335,000, with private average selling prices at £374,000. Taylor Wimpey guided towards average outlets being higher in 2026 than in 2025, with UK volume guidance of 10,600 to 11,000 completions. The company expects adjusted operating profit of around £400 million, with pre-exceptional net finance charges of around £30 million. Analysts estimate revenue growth of 6.6% for the next year, indicating a positive outlook.

Valuation and Dividend Policy

Taylor Wimpey's valuation metrics indicate a relatively stable position, with a P/E Ratio of 41.96, P/B Ratio of 0.85, and Dividend Yield of 9.28%. The company's dividend policy has been updated to introduce flexibility in how the 7.5% of net assets is delivered, with a minimum of 5% to be paid as a regular ordinary dividend and the remaining portion returned via dividend or share buyback. The company declared a final 2025 dividend of £0.0295 per share and a £52 million share buyback.

Market Conditions and Challenges

The UK housing market remains challenging, with customer sentiment and affordability constraints affecting demand. First-time buyer numbers are improving, but deposit building remains a challenge, particularly in the south. The Section 106 affordable housing market is also challenging, with securing partners being a difficulty. However, the company is well-positioned for 2026 affordable deliveries, and its assertive planning strategy is delivering results, with a 28% increase in detailed planning for over 10,000 plots in 2025.

Cost Inflation and Procurement

Taylor Wimpey is guiding towards low single-digit build cost inflation, likely higher than the 1% seen in 2025, due to pressure from raw materials, energy, packaging, and labor. The company has made significant changes to its procurement practices, including expanding centrally managed categories, retendering, and introducing e-auctions. The new house type range accounted for over 1/4 of completions in 2025 and will rise to almost half in 2026, indicating a focus on cost management and efficiency.

3. NewsRoom

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There May Be Reason For Hope In Taylor Wimpey's (LON:TW.) Disappointing Earnings

Mar -27

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3 UK Stocks That May Be Undervalued By The Market

Mar -25

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Sub-4% mortgage rate ends as NatWest, Barclays, Nationwide and Halifax hike costs

Mar -19

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Taylor Wimpey PLC (TWODF) Full Year 2025 Earnings Call Highlights: Strong Revenue Growth Amid ...

Mar -07

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Taylor Wimpey cautions over another earnings drop in 2026 in tough market

Mar -05

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NatWest cuts mortgage costs ahead of spring statement

Feb -26

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Zoopla buys online business newhomesforsale.co.uk

Feb -24

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UK Stocks Trading Below Estimated Value In January 2026

Jan -22

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.71%)

6. Segments

Institutional

Expected Growth: 5.5%

Taylor Wimpey plc's 5.5% institutional growth is driven by increasing demand for new homes, strategic land acquisitions, and partnerships with local authorities. Additionally, the company's focus on affordable housing and its 'Taylor Wimpey Plus' initiative, which offers customers a range of upgrade options, contribute to its growth.

Wholesale

Expected Growth: 5.8%

Taylor Wimpey's 5.8% wholesale growth driven by increasing demand for affordable housing, strategic partnerships with housing associations, and expansion into new regions. Additionally, the company's focus on cost savings, operational efficiencies, and investment in digital capabilities have contributed to the growth.

Retail

Expected Growth: 6.2%

Taylor Wimpey's 6.2% retail growth driven by increasing demand for new homes, particularly in the UK, fueled by government initiatives such as Help to Buy and a shortage of housing supply. Additionally, the company's focus on affordable housing and strategic land acquisitions have contributed to its growth.

Market Data

Expected Growth: 6.5%

Taylor Wimpey's 6.5% growth driven by increasing demand for new homes, strategic land acquisitions, and partnerships with local authorities. Additionally, the company's focus on affordable housing, cost savings initiatives, and strong balance sheet have contributed to its growth momentum.

7. Detailed Products

Homes

Taylor Wimpey plc is one of the largest residential developers in the UK, building a range of homes from apartments to detached houses.

Part Exchange

Taylor Wimpey's Part Exchange scheme allows customers to trade in their existing home as part of the purchase of a new Taylor Wimpey home.

Easymove

Easymove is a service offered by Taylor Wimpey that helps customers sell their existing home quickly and easily.

Incentives

Taylor Wimpey offers a range of incentives to help customers purchase a new home, including Help to Buy and other government-backed schemes.

Land and Planning

Taylor Wimpey's Land and Planning team works with landowners, developers, and local authorities to identify and acquire land for development.

8. Taylor Wimpey plc's Porter Forces

Forces Ranking

Threat Of Substitutes

Taylor Wimpey plc faces moderate threat from substitutes, as customers have limited alternatives to traditional housing. However, the rise of alternative accommodation options, such as shared living spaces, could pose a threat in the future.

Bargaining Power Of Customers

Taylor Wimpey plc's customers have limited bargaining power, as they are individual buyers with limited negotiating power. However, the company's reputation and quality of service can influence customer loyalty.

Bargaining Power Of Suppliers

Taylor Wimpey plc's suppliers, such as construction material providers, have moderate bargaining power. While the company has some negotiating power, suppliers can still exert pressure on prices and delivery terms.

Threat Of New Entrants

The threat of new entrants in the UK housing market is low, as significant barriers to entry exist, including high capital requirements and regulatory hurdles. However, new entrants could still disrupt the market with innovative business models.

Intensity Of Rivalry

The UK housing market is highly competitive, with several established players competing for market share. Taylor Wimpey plc must differentiate itself through quality, pricing, and customer service to maintain its market position.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 2.73%
Debt Cost 12.67%
Equity Weight 97.27%
Equity Cost 12.67%
WACC 12.67%
Leverage 2.80%

11. Quality Control: Taylor Wimpey plc passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Berkeley

A-Score: 6.0/10

Value: 6.4

Growth: 4.1

Quality: 7.2

Yield: 6.9

Momentum: 3.0

Volatility: 8.3

1-Year Total Return ->

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Stock-Card
Bellway

A-Score: 5.5/10

Value: 4.9

Growth: 5.2

Quality: 5.6

Yield: 6.2

Momentum: 5.0

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
Persimmon

A-Score: 5.3/10

Value: 6.5

Growth: 1.4

Quality: 5.2

Yield: 8.8

Momentum: 4.0

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
Redrow

A-Score: 5.1/10

Value: 6.8

Growth: 5.2

Quality: 7.4

Yield: 4.4

Momentum: 4.0

Volatility: 3.0

1-Year Total Return ->

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Stock-Card
Taylor Wimpey

A-Score: 4.8/10

Value: 4.4

Growth: 1.6

Quality: 5.2

Yield: 8.8

Momentum: 1.5

Volatility: 7.3

1-Year Total Return ->

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Stock-Card
Barratt Developments

A-Score: 4.6/10

Value: 3.5

Growth: 2.4

Quality: 4.6

Yield: 7.5

Momentum: 3.0

Volatility: 6.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

0.85$

Current Price

0.85$

Potential

-0.00%

Expected Cash-Flows