Taylor Wimpey Share Price Forecast Ahead of H1 Earnings

The Taylor Wimpey share price is in a tight range ahead of the company’s half-year results. The stock is trading at 165p, which is about 12% above the lowest level in July. It is about 15% below its highest point this year, giving it a market capitalization of more than 6 billion pounds.

Taylor Wimpey news

TW is one of the leading homebuilders in the UK. The company builds thousands of home across the country each year. This gives it an annual revenue of more than 2.79 billion pounds. Other FTSE 100 homebuilders are Persimmon and Barratt Developments.

The company will be in focus this week as it publishes its quarterly results. It will join other firms like Rolls-Royce and BP that will publish their results this week.

Analysts expect that the Taylor Wimpey will publish strong quarterly results because of the strength of the housing sector. Recent data has shown that house prices in the UK have jumped by more than 20,000 pounds in the past 12 months. Also, demand for houses has been so high because of the recent government incentives.

In its most recent trading statement, the company said that its total order book value rose to more than 2.8 billion pounds by April. That was higher than 2.668 billion pounds in the same period in 2020. Precisely, the number represented 10,995 homes. 

Still, the firm faces two main challenges going forward. First, home prices have started retreating as evidenced by data by Halifax and Nationwide. Second, the industry faces high cost of doing business, which could affect its margins. This cost is about employee cost and higher commodity prices. So, what next for the TW share price?

Taylor Wimpey share price forecast

The daily chart shows that the Taylor Wimpey stock price rose to a year-to-date high of 193.85p in April. Since then, the stock has declined sharply as investors anticipate higher costs and low demand. Along the way, the stock is forming a head and shoulders pattern. It remains along the 25-day and 50-day moving averages. In price action, H&S is usually a bearish sign. 

Therefore, there is a possibility that the stock will resume the downward trend as investors target the key support at 147.95, which was the lowest level in July. However, a move above the resistance at 175p will invalidate this view.

Taylor Wimpey share price