Taylor Wimpey (TW.) forecast a fall in this year’s operating margin, adding to the gloom around UK housebuilders. The admission came as the firm posted in-line results for the year to December 2025.
Completions excluding JVs were in line with forecasts at 10,614 units, while average prices for private sales were 5% higher. As a result, revenue for 2025 rose around 12% to £3.8 billion and operating profit increased slightly to £420 million.
Net private reservations were flat at 0.75 per week, and the cancellation rate stayed at 15% as in 2024. The order book excluding JVs was down 6% at 6,832 units and 6% by value at $1.86 billion.
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LOWER OPERATING MARGIN FOR 2026
The group said it saw improved momentum in planning decisions in the final quarter, which is positive for future developments. However, uncertainty ahead of the Autumn Budget impacted sales and the 2026 order book.
The firm also noted land sales were strong last year, helping margins, but weren’t expected to hit the same levels this year. Meanwhile, build cost inflation is still seen at low single digits, so 2026’s operating margin will be down on 2025.
That’s three for three for the housebuilders this week, with Persimmon (PSN) and Vistry (VTY) also falling on their updates.
There are lots of bulls of the sector but at the risk of repeating ourselves we just don’t see a positive catalyst. The fact most of the sector looks cheap on a P/E basis isn’t enough to make us want to buy.
Stocks can stay cheap for longer than you think, just as they can stay expensive for longer than you think. Put simply, we think there are better opportunities elsewhere in the market.
Read the press release here: https://www.taylorwimpey.co.uk/corporate/investors
Read related news here: https://sharesify.com/vistry-falls-despite-confirming-full-year-guidance/
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