Result of the week: Villa World

Josh Kitchen

Villa World continues to build on strong foundations, delivering a solid result and a 6% upgrade to full year earnings guidance. It is developing an enviable reputation of under-promising and over-delivering with FY17 set to deliver another record. Since 2014, EPS has grown at a compound rate of nearly 15% p.a..

Villa World constructs affordable residential housing in identifiable high growth corridors on the eastern seaboard of Australia where positive market conditions are supported by a rising population and job creation. The highly experienced management team is focused on achieving consistent growth through the cycle while maximising shareholder returns via dividends.

Trading on a non-demanding PE of only 7.3x with a fully franked dividend yield of 7.6%, healthy balance sheet and 5+ years of land bank, Villa World has flown under the radar for too long. A proven consistent performer, it is now becoming hard to ignore. Satisfying our investment objectives, it remains a core holding of the fund.


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