As we commented recently, we think there could be some value in housing. This week we're going to look at a housebuilder whose patient approach to rebuilding its dividend has resulted in a payout that might be the safest in the sector.
FTSE 250 firm Redrow (RDW) was founded by chairman Steve Morgan in North Wales, nearly 45 years ago. The firm originally specialised in drainage contracting, but by 1979 had moved into housebuilding. By 2006, the firm had sold 50,000 houses, and in October 2018, the group handed over its 100,000th home.
Mr Morgan originally retired from the business in 2000, but returned in 2009 to rebuild Redrow after the financial crisis. He now plans to retire again in March 2019, ten years after his return. It's not yet clear if he will maintain his current 32.5% shareholding in the group. But it seems reasonable to expect that he will keep a significant shareholding for the foreseeable future.
The last ten years…
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