Financial Trading Blog

Stock of the day 11/08/2016 – Bovis Homes Group PLC



Can Bovis Homes provide a sufficiently Brexit fears-calming half year report next Monday?


Things had been going pretty well for Bovis Homes before the Brexit vote; while it didn’t look like it was going to scale the heights of the £12 all-time highs it struck last year, the stock had climbed to an effective 2016 peak of £10.28 on the eve of the referendum results. You can probably guess what happened next, however. Bovis Homes plunged 24% in the space of one trading session (and went even lower during the day’s trading) as Britain chose to leave the EU, eventually closing at a 40 month nadir of £7.77. Since then it has managed to climb back to £8 but not much higher, the stock sitting at a current trading price of £7.93 (IT-Finance.com, 11/08/2016).

Bovis Homes Group PLC Chart August 2016 Spreadex Financial Spread Betting
(Source: IT-Finance.com 11/08/2016)

While not the first company to update in the aftermath of the Brexit result, just under a fortnight after the referendum Bovis Homes released a trading statement with the intention of reassuring investors about the state of its business. The firm revealed it built a record number of homes in the first half of the year, up 5% to 1601, with a 15% surge in average sale price to £255k, while also claiming that it was ‘too early to assess the impact of the EU referendum on the UK housing market’.

That reasoning likely won’t hold water this time around, with the Bovis Homes now having had more than a month to see if there has been any post-Brexit impact. The latest figures from the sector would suggest there has been, with housing prices growing at their slowest pace for 3 years across July. The company, then, will be under pressure to deliver a more comprehensive statement on the effects of the referendum result, something that will matter far more to investors than the now somewhat irrelevant first half figures.

Bovis Homes Group PLC has a consensus rating of ‘Hold’ with an average target price of £10.11.

MARKET ANALYSIS

RECENT POSTS

DISCLAIMER


Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 64% of retail investors lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money. For professional clients, spread betting and CFD trading can also result in losses larger than your initial stake or deposit.

 Spreadex Ltd is authorised and regulated by the Financial Conduct Authority, provides an execution only service and does not provide advice in any way. Nothing within this update should be deemed to constitute the provision of investment advice, recommendations, any other professional advice in any way, or a record of our trading prices. This update does not constitute or form part of an offer of, or solicitation for a transaction in any financial instrument, nor shall it or the fact of its distribution form the basis of, or be relied on in connection with, any contract therefore. Any persons placing trades based on their interpretation of the comments or information within this update does so entirely at their own risk.

No representation, warranty, or undertaking, express or limited, is given as to the accuracy or completeness of the information or opinions contained within this update by Spreadex Ltd or any of its employees and no liability is accepted by such persons for the accuracy or completeness of any such information or opinions. As such, no reliance may be placed for any purpose on the information and opinions contained within this update.

The information contained within this update is the intellectual property of Spreadex Ltd and is protected by UK and International copyright laws. All rights reserved. Users may however freely download, distribute and reproduce extracts of the contents, subject always to accrediting Spreadex Ltd as the source and providing a hyperlink to www.machibet77.com.