Skip to content

Can Bovis Homes shares build on some solid foundations?

Can Bovis Homes shares build on some solid foundations?

After a very strong 2017, and impressive open to 2018, Bovis Homes shares have gone off the boil in the last few months.

Opening at £11.67, the housebuilder had managed to strike an all-time high of £13.15 by the end of May, overcoming a wobble that had left it under £10.50 in early February.

Yet, as mentioned, the company has struggled since hitting that record peak.

By the end of October it was trading in the £9.20s, its worst level in 15 months, and though it has lifted off those lows, it is still a way away from May’s highs. Bovis Homes shares now sit at a current trading price of £10.07.

September’s interim results

Despite its recent market-troubles, September’s interim results weren’t half bad. Total competitions rose 4% to 1580, and though the private average selling price remained unchanged at £334,700, group revenue nudged up 1% to £432.2 million.

More importantly, a 280 basis points improvement to its gross margin to 20.9% helped pre-tax profit rocket 41% higher to £60.2 million, with its dividend also up 27% to 19p per share. On top of this Bovis claimed that, ‘following a robust summer’, it now expects its full year profits ‘to be at a record level and at the top end of the Board’s expectations’.

Quite the performance for a company that has spent the last year or so mired in controversy over the quality of its properties.

As for Thursday’s Q3 update, investors will basically just want more of the same, i.e. an indication that the company is still on track to reach those promised record levels of profit.

Bovis Homes shares have  a consensus rating of ‘Hold’ alongside an average target price of £12.03.

  • Visit spreadex website

This article is brought to you in association with Spreadex. All opinions expressed in this article are from the author and do not necessarily represent the opinions of The Armchair Trader. You can find out more about Spreadex products and services here, or find more articles from Connor Campbell here.

Share this article

Invest with these platforms

Hargreaves Lansdown

IG

Interactive Brokers

Interactive Investor

Charles Stanley

IG

Interactive Brokers

Charles Stanley

Looking for great investing ideas? Get our free newsletter.
Join our UK news channel on WhatsApp

This article does not constitute investment advice.  Do your own research or consult a professional advisor.

Learn with our free 'How to' Guides

Our latest in-depth company reports

On the podcast

Sign up for great investing stock tips

Thanks to our Site Partners

Our partners are established, regulated businesses and we are grateful for their support.

Aquis
CME Group
FP Markets
Pepperstone
Schroders

TMX
WisdomTree
ARK
FxPro
CMC Markets
Back To Top