Down 17% per month and yielding 7.39%! Is this FTSE 100 share a screaming buy for me?

I mean strong FTSE 100 Shares with a strong balance sheet, moderate valuations, generous yields and a strong profit outlook may pick up speed, as a real estate developer. Taylor Wimpey (LSE: TW) is currently showing us.

Taylor Wimpey’s share price decreased by 17.73% compared to the previous trading day. I’m holding a stock and I’m getting hurt. Over 12 months, it increased by 2.77%.

I bought Taylor Wimpey shares three times last year, and for a while they were booming. I was over 40% and was getting 7% more yield. Then everything went wrong.

Why do stocks crash?

I grew up on Taylor Wimpey because I was impressed with how its balance sheet and share price remained strong throughout the pandemic and the cost of living crisis.

While earnings inevitably dropped in 2020, they rebounded quickly. They fell again in 2023 but investors held on to the hope that at some point inflation and interest rates would follow, making mortgages much cheaper.

On November 7, the board backed its full-year outlook for 2024 as demand and affordability improve. It is expected to reach the high end of its target of building 9,500 to 10,000 new homes, with an operating profit in line with current market expectations of £416m.

That’s down from £473.8m in 2023 amid fewer completions but the order book grew from £1.9bn to £2.2bn, excluding joint ventures.

However, the Budget of 30 October is painful. Chancellor Rachel Reeves’ decision to offload national insurance contributions worth an extra £25bn on employers will put pressure on Taylor Wimpey. They are predicted to drop from 13.3% to 12% next year. A shortage of skilled labor may also push up wages.

And the Bank of England predicts that the Budget will increase inflation back to 3% by 2025, and mortgage lenders are riding rates.

I will stick to diversified income and growth prospects

The policies of the US President-elect Donald Trump are also expected to increase significantly, adding to the interest rate problems. Higher inflation will also increase Taylor Wimpey’s input costs.

In another development, Labour’s plans to build 1.5m houses over five years are looking promising. Ironically, that may support Taylor Wimpey, by reducing supply at a time of peak demand.

The shares look reasonably priced to me, trading at 12.8 times earnings. This is still a good budget benefit. The 2024 yield is 7.34% and analysts expect this to reach 7.56% in 2025. Its record is reasonably strong, as this chart shows.

Chart with TradingView

The 16 analysts providing one-year share price forecasts have set an average target of 167.65p. If that happens, it’s up 29.32% from today. Which would be brilliant.

Interestingly, the range of recommendations is not that wide. An impressive 12 calls for Taylor Wimpey are Strong Buy, two are Buy and two are Hold. No one is suggesting a sale. I certainly don’t think so. I would rate it as a Strong Buy again.

If I didn’t have a large stake, I would take this opportunity to buy more with a long-term perspective. Britain needs housing, and I think I need dividend growth stocks like Taylor Wimpey.