Berenberg cuts Barratt Developments’s target price due to lower estimates for margins

by | Sep 11, 2023

(Sharecast News) – Analysts at Berenberg took a knife to their target price for shares of Barratt Developments on the back of its latest guidance.
On 6 September, the residential property developer reiterated its forecast for fiscal year 2024 volumes of 13,250-14,250.

The mid-point of that range implied a roughly 20% reduction in comparison to the prior year.

But Berenberg was also now anticipating a lower 2024 margin of 10.5%, instead of the 12.2% previously seen.

In turn, that drove downgrades to its estimates for Barratt’s earnings per share, which were cut by 12% across 2024-26.

The target price meanwhile was reduced from 552.0p to 495.0p.

Nonetheless, they noted that their previous margin estimate had been at the higher end of the consensus range.

Om the flip-side, they judged that the developer’s guidance for cost inflation of 5% in FY 2024 might prove “slightly” conservative due to the pace at which build cost inflation was now falling.

Related articles

RBC Capital cuts Rentokil price target

RBC Capital cuts Rentokil price target

(Sharecast News) - RBC Capital Markets cut its price target on Rentokil Initial on Wednesday to 575p from 610p as it downgraded forecasts for forex and a greater back-end loading of TMX synergies, but said it believes the long-term story remains intact. The bank said...

Trending stories

Join our mailing list

Subscribe to our mailing list to receive regular updates!

x