Vistry Group PLC (LON:VTY), previously known as Bovis Homes, has been upgraded to ‘buy’ from ‘neutral’ by analysts at Citi, who said there is still value among the UK’s housebuilders despite a strong sector performance in 2019.
“We believe sector net assets are poised to grow [circa] +17% on an annualised basis…over the next three years, supported by modest volume growth, improving margin outlook and strong cash generation”, the bank said in a note on Friday.
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Analysts said the spring selling season was likely to be a “key catalyst for the sector” while improving buyer interest is expected to support volume growth further.
Citi said Persimmon PLC (LON:PSN), Redrow plc (LON:RDW) and Taylor Wimpey PLC (LON:TW.) were its top picks for the sector, it downgraded Barratt Developments PLC (LON:BDEV) to ‘neutral’ from ‘buy’ and stayed neutral on Berkeley Group Holdings PLC (LON:BKG).
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Persimmon is the housebuilder attracted most positivity among analysts, with both Canaccord Genuity and Berenberg also listing the firm among their top picks in sector notes this week.
The positive outlook for the sector has been mostly attributed to the Conservative victory in last month’s election, which many say has restored certainty and attract more investment into the UK property market.