Broker Berenberg says 2021 was an “incredible year” for the UK construction sector with average earnings upgrades at around 26% but prospects in the current twelve months look almost as bright.
Macro concerns have taken some of the gloss off share prices, but the broker believes that for the first time in years the demand outlook is favourable across most end markets, though the overhanging supply-chain issue means investors need to choose carefully.
Of the UK-listed groups, Kingspan PLC the Ireland-based insulation board the was embroiled in the Grenfell Tower disaster fallout, is its top pick with 'buy' recommendations on most of the housebuilders including Barratt, Bellway, Crest Nicholson (LSE:CRST), Persimmon and Taylor Wimpey and also contractor Balfour Beatty.