Crest Nicholson PLC's (LSE:CRST) share price jumped 9% in early trading after the housebuilder reported a strong start to the year, with signs of improvement in sales and operations.
In the first 10 weeks of the year, open market sales rose to 0.61 per site per week, up from 0.50 last year. Customer satisfaction also hit 95%, well above the 87.3% recorded in 2023.
CEO Martyn Clark said early efforts to improve sales and efficiency were paying off, although the housing market remains uncertain due to stubborn inflation and delayed interest rate cuts.
Despite this, Crest Nicholson is on track to meet its full-year targets, with cash flow performing better than expected.
At its investor event in Windsor, the company will routine plans for steady growth, focusing on building quality homes, improving customer experience, and making better use of its land portfolio.
Over the next five years, it aims to boost home completions, increase margins, and improve profitability.
Peel Hunt said the shares, up 13.19p at 166.1p, are currently priced much lower - about 40% less - than the actual value of its assets.
This gap should shrink as the company successfully follows its plan and improves profits, the broker reckons.
Over time, its earnings and performance should get back in line with industry standards, which could help boost the share price.
Peel Hunt repeated its 'add' recommendation, while US investment bank Stifel says 'buy'.