UK housebuilders' stock market valuations are lower now than at the start of the year, though trading conditions are "more robust", analysts at broker Jefferies reckon.
They noted that shares are on average now trading below the net tangible asset value (P/NTAV) and were back to below pre-election levels, even though earnings per share forecasts are more than 10% higher.
"The UK Budget was unhelpful to mortgage pricing and direct build costs," the analysts acknowledged in the note to clients on Tuesday.
"However, trading conditions remain more robust versus the start of '24 (and EPS >10% higher), with further upside potential from changes in planning driving the next cycle of land investment and possible demand-side incentives."
The analysts said catalysts to move the share may not arise until the first quarter of 2025, "but today offers a strong valuation opportunity, we think".
Jeffries has 'buy' ratings on Bellway PLC (LSE:BWY) and Persimmon PLC (LSE:PSN), with a 'hold' stance for the rest of the sector, including Taylor Wimpey PLC (LSE:TW.), Barratt Redrow PLC (LSE:BTRW), Berkeley Group Holdings PLC (LSE:BKG), Crest Nicholson PLC (LSE:CRST), Vistry Group PLC (LSE:VTY) and Watkin Jones PLC (AIM:WJG).