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Barratt Developments PLC BDEV

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Stock XLON Rating as of
GBX 519.80 +10.60 (2.08%)
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As of Delayed Price Closed
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Company Report

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Barratt: Investors Shrug Off Signs of Firming Homebuyer Appetite Amid Soft Fiscal 2025 Guidance

Grant Slade

No-moat Barratt Developments’ July 2024 trading update proved mixed, offering on one hand signs that homebuyer confidence continues in 2024 to rebound from its 2023 cyclical low point. On the other, Barratt delivered soft fiscal 2025 guidance that underwhelmed investors. Pleasingly, Barratt’s weekly private home sale rate increased to 0.69 sales per active outlet in the second half of fiscal 2024, up 24% sequentially on a seasonally adjusted basis. Furthermore, Barratt’s private home sales rate firmed as the second half of fiscal 2024 progressed, underscoring the improving conditions in the UK housing market and according with recent improvement in observed housing market datapoints.

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Price vs Fair Value

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BDEV is trading at a 226% premium.
Price
GBX 509.20
Fair Value
GBX 945.00
Uncertainty
High
1-Star Price
GBX 8,446.00
5-Star Price
GBX 726.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Underlying housing demand is likely to benefit from the UK’s changing demographics. The ongoing aging of the population is likely to support demand for new housing over the coming decade as the average household size declines.

Bears

The UK government’s annual target of 300,000 new home additions is unlikely to materialize, with housing market data not indicative of a material undersupply of housing.

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Trading Information

Previous Close Price
GBX 509.20
Day Range
GBX 506.60–519.80
52-Week Range
GBX 384.15–582.60
Bid/Ask
GBX 490.00 / GBX 538.00
Market Cap
GBX 506.59 Bil
Volume/Avg
6.8 Mil / 5.5 Mil

Key Statistics

Price/Earnings (Normalized)
12.74
Price/Sales
1.17
Dividend Yield (Trailing)
5.37%
Dividend Yield (Forward)
5.37%
Total Yield
7.80%

Company Profile

Barratt Developments is the UK’s largest residential property developer by revenue and dwelling completions, marketing homes under its three brands: Barratt Homes, David Wilson, and Barratt London. Aligning with the typical business model employed by UK homebuilders, Barratt is vertically integrated through the land development, construction, and sales and marketing segments of the residential property development value chain.
Sector
Consumer Cyclical
Industry
Residential Construction
Stock Style Box
Mid Value
Total Number of Employees
6,389
Website
https://www.barrattdevelopments.co.uk

Competitors

Valuation

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Metric
BDEV
BKG
BWY
Price/Earnings (Normalized)
 12.7412.1212.85
Price/Book Value
 0.931.500.97
Price/Sales
 1.172.191.19
Price/Cash Flow
 24.1815.9413.47
Price/Earnings
BDEV
BKG
BWY

Financial Strength

Metric
BDEV
BKG
BWY
Quick Ratio
 0.860.640.33
Current Ratio
 4.923.575.78
Interest Coverage
 7.1723.088.81
Quick Ratio
BDEV
BKG
BWY

Profitability

Metric
BDEV
BKG
BWY
Return on Assets (Normalized)
 4.95%6.78%5.22%
Return on Equity (Normalized)
 7.02%13.98%7.58%
Return on Invested Capital (Normalized)
 6.74%11.33%7.82%
Return on Assets
BDEV
BKG
BWY
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