The stock market continues to leave me baffled. Shares in Taylor Wimpey, one of the UK’s three biggest housebuilders, yield 8.9 per cent, on next year’s 13.8p indicated dividend, even after rising 9¾p to 154½p on the interim figures. This year’s payment is less generous, 10.91p, but even then the yield is 7 per cent.
For any share, in normal times, where the yield had risen above 6 per cent, the market was saying that the dividend was to be cut and that the company was in trouble. Yet there seems no possible eventuality, other than a complete meltdown in the housing market, why that payment should not be made. Taylor Wimpey is piling up cash.
The company has made it clear that if