Peel Hunt has reiterated its 'sell' recommendation for Taylor Wimpey saying that while Wednesday's trading statement was broadly in line, the house builder appears more cautious than its peers.
"While the statement points to improving metrics for H1 the tone of the statement is a little less upbeat than we have seen here earlier in the year and elsewhere in the sector," said analyst Robin Hardy.
He said that margins were better than expectations at 11% in the first half. This will likely drive upgrades to full-year margin and profit estimates.
However, the broker says that the macro environment still remains "soft": "mortgage approvals [are] still very materially below any kind of norm and while there is apparently stability in pricing it is something of false image with the distortion from London. National house builders including TW do not really benefit from this and we still see a long slow deflation in selling prices."
"We are reviewing our target price [currently 27p] for TW as we change our valuation methodology but even a higher target price is unlikely to change our stance and we remain negative."
Shares were trading 2.62% lower at 47.97p just before midday.
After falling to its worst level in over six weeks, London's FTSE 100 opened broadly flat on Friday morning with investors refraining from building positions ahead of the all-important US jobs report due out this afternoon. [7 Jun '13]
House builder Taylor Wimpey said its sales performance since the start of the year had been "at the upper end of our expectations" but lamented that mortgage lending remained a constricting factor on the market. [25 Apr '13]
A number of heavyweight stocks going ex-dividend assured that London's FTSE 100 index was in the red for a fourth consecutive day on Wednesday, while concerns over the global economy continued to weigh on sentiment. [17 Apr '13]
UBS has upgraded its ratings for both Redrow and Bovis and now has 'buy' recommendations across the whole UK housebuilding sector, saying that the government's new initiatives should be beneficial for stocks. [26 Mar '13]
Markets on the whole gave a muted reaction to George Osborne's Budget Statement today, in which he warned that Britain would grow less and borrow more than originally estimated, while traders continued to digest developments elsewhere, including the Cypriot bailout and a meeting at the US Federal Reserve. [20 Mar '13]
Shares in Barratt Developments, Taylor Wimpey, Persimmon, Bellway, Redrow and Bovis Homes Group all charged higher on Wednesday afternoon after the Chancellor, George Osborne, said in his 2013 Budget speech that the government was launching a programme to help people get on, or move up, the property ladder. [20 Mar '13]
Datafeed and UK data supplied by NETbuilder and Interactive Data.
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