nice starting point..

Analysts at Deutsche Bank have today delivered a glowing review of the prospects for the UK’s homebuilders, in turn raising their price targets on all of the companies within their universe.

Thus, they explain that, “through 2012 the UK house builder sector re-rated, moving from 0.69 times 2012 Net Tangible Asset Value (NTAV) to 1.0 times 2013 NTAV. However, as the sector reaches returns that cover its cost of capital in 2013, moving to mid teen levels by 2014/2015, we believe a further rerating is available. A sector creating mid teen return on capital employed (ROCE) on a sustainable basis (the upside being based on self-help measures rather than any housing market pick-up) we believe deserves to trade at a 20% premium to its NTAV (mid-range of its 2000-2005 valuation range).”

Its analysts have raised their price target on Barratt Developments to 278p (from 224p), on Bovis to 667p (from 599p) and on Berkeley Group to 1,941 (from 1,925).

BDEV Barrat Developments.


Gone long on BDEV already hold TW.

Full broker note here from Deutsche.......

European Daily Focus

Deutsche Bank AG/London Page 3

UK HOUSEBUILDERS Outlook 2013 - remaining positive but being selective

Our top picks remain for Barratt, Berkeley and Bovis.
Despite expectations of constrained economic and mortgage activity in 2013, we believe the pull-through of higher
margin new land should sustain upwards momentum in consensus ests. Market share gains and govt support offer
upside to volumes which could supplement this further. Given the strong performance of the UK housebuilders in the
past 12 months the obvious valuation gap in the sector has closed. However with the sector anticipated to achieve
mid teens ROCE by 2014/5 we believe a further re-rating is available. We remain positive on the housebuilders,
although we would look to be selective in our stock selections. Top picks: Barratt, Berkeley and Bovis.
DB ests upgraded by 0-20%, now top end of consensus.
Through 2012 the UK housebuilders saw double digit percentage increases in consensus PBT forecasts. However
with the future years not yet adequately reflecting the increasing contribution of the higher margin new land we have
increased our forecast PBT 2013-15 by a further 0-20%. The largest of these upgrades were at Barratt, Bovis and
Taylor Wimpey, however it is in our most favoured names – Barratt, Berkeley and Bovis where our forecasts are
approx 15-20% ahead of consensus. Our forecasts are currently based on only a 2% increase in selling rates. Any
upside in mortgage lending or greater market share gains would suggest further upgrades could be available.
Moving our price targets, still more to go for
Through 2012 the UK housebuilder sector re-rated, moving from 0.69x 2012 NTAV to 1.0x 2013 NTAV. However as
the sector reaches returns that cover its cost of capital in 2013 moving to mid teen levels by 2014/15 we believe a
further rerating is available. A sector creating mid teen ROCE on a sustainable basis (the upside being based on self
help measures rather than any housing market pick-up) we believe deserves to trade at a 20% premium to its NTAV
(mid range of its 2000-2005 valuation range).
Still 15-30% upside in share prices available without housing market recovery
Given the strong share price performances through the past 12 months, the upside to our price targets in 2013 lack
the massive scale seen in the previous 2 years. However in focusing on those stocks offering the greatest scope for
positive surprise in forecasts and where valuation re-rating remains possible we believe at least 15-30% share price
performance could be available (based on a stable economic and mortgage outlook). Our top picks are Barratt
(significant P&L leverage to new land, faster than expected debt paydown, strong turnaround in ROCE, 10% discount
to NTAV), Bovis (strong growth story with volumes, price and margins all offering scope for upside, a fast turnaround
in ROCE, 10% discount to NTAV) and Berkeley Group (strong pick up in the selling prices and margins from its new
London developments with potential for larger cash returns in the medium term). Barratt would be our preference in a
scenario of higher volumes.
Risks
Risks to the sector include the availability and affordability of mortgages, interest rate, unemployment rate and
consumer confidence, government funding and policy on planning, the timing and profitability of new land, changes
in raw material and labour pricing.

BDEV

Brokers with a positive Buy Rating
on BDEV.........

Looks way too cheap too me trading
on a forward P/E of 12.7 to 2014
and historical P/E of 21.4... 2012.

Looks like scope for a major re- rating.

Date Company Name Broker Rec. Price Old target price New target price Notes

08 Jan 13 Barratt... Deutsche Bank Buy 216.15 224.00 278.00 Retains
17 Dec 12 Barratt... Credit Suisse Neutral 216.15 185.00 223.00 Retains
29 Nov 12 Barratt... HSBC Overweight 216.15 170.00 241.00 Retains

N@P Building Society

INVESTMENT RATIOS
2012 (A) 2013 (E) 2014 (E)

EBITDA £204.90m £243.89m £290.00m
EBIT £203.30m £245.00m £249.40m
Dividend Yield 0.00% 0.72% 1.52%
Dividend Cover x 7.65x 5.17x
PER 21.41x 18.12x 12.71x
PEG 0.13f 1.00f 0.30f
Net Asset Value PS 213.32p 324.40p 302.20p

Hemscott Premium.

http://www.telegraph.co.uk/finance/economics/9799378/Personal-View-Housebuilders-lead-the-way-out-of-our-economic-slump.html

Trading Statement

Highlights

· Group revenues of c. £950m, in line with prior year, and total completions of 5,085 units

· Private completions increased by 5.3% on the prior year to 4,241 units

· Group operating profit expected to be c. £80m for the period, up by c. 31% on the prior year

· Operating margin expected to increase to c. 8.4%, up from 6.4% in the prior year

· Profit before tax expected to be c. £45m, more than double the prior year

· Significant increase in approvals to acquire higher margin land with £453.0m of land acquisitions approved in the period equating to 9,320 plots on 67 sites

· Net debt as at 31 December 2012 of around £332m was significantly reduced from the £542.2m prior year position

· Private forward sales (excluding JVs) of £536.5m as at 31 December 2012 up 35.5% on the prior year

BDEV BARRAT DEVELOPMENTS

Excelent set of results.

profits more than doubled.

http://www.investegate.co.uk/barratt-developments-(bdev)/rns/trading-statement/201301160700066533V/

BUY notes coming out.

16 Jan Barratt... BDEV Shore Capital Buy 226.40 226.50 - - Reiterates

UPDATE 1-UK's Barratt sees "significant" improvement in profit16 Jan 2013 - 07:27

LONDON, Jan 16 (Reuters) - British housebuilder Barratt said it expects a "significant" improvement in profits for the full year 2012-2013 after its profit before tax more than doubled in the first six months to December. Barratt, the UK's largest housebuilder by market volume, said on Wednesday it expects pre-tax profit over the half year period to rise by 108 percent to 45 million pounds ($72 million)and posted group revenues of 950 million pounds, in line with the prior year. The company completed 5,085 units over the period and secured private forward sales, excluding joint ventures, of 536.5 million pounds by the end of December, up 35.5 percent over the prior year, it said. "This has been a good first half performance," Group Chief Executive Mark Clare said. "In addition, we have been investing for the future, successfully securing higher margin land both in the South-East and across the rest of the country that will drive further profit growth. "We are on track to deliver around half of our full year completions from higher margin land, and combined with our continued focus on driving efficiency across the group, we expect to deliver a significant improvement in profitability for the full year 2013." Barratt said it had agreed terms on 453 million pounds worth of new land in the first half, equating to 9,320 plots on 67 sites, and that it expects to agree terms on 15,000 plots for the full year. It also said that it had bought two sites in London with a development value of 400 million pounds which would provide more than 1,000 new homes for the capital. Barratt and its rivals such as Taylor Wimpey and Persimmon have in the past year sought to beat a sluggish market by buying land cheaply during the recession, building more lucrative family homes rather than flats and focusing on areas where prices have stayed strong such as London and south England. Shares in Barratt, which have more than doubled in price over the past year, closed at 226.5 pence on Tuesday, valuing the company at 2.2 billion pounds. ($1 = 0.6215 British pounds) (Reporting by Brenda Goh; editing by Kate Holton) ((brenda.goh@thomsonreuters.com)(+44 020 7542 2230)(Reuters Messaging: brenda.goh.thomsonreuters.com@reuters.net)) Keywords: BARRATT/

Davy Research ‏@DavyResearch
Barratt Developments - Trading update signals good progress in margin improvement and debt pay-down in fi... -

http://www.davy.ie/LR?id=8334

Precogz Updates ‏@Precogz
#BDEV Barratt strategy paying off as update points to robust financial performance - Proactiveinvestors

http://www.proactiveinvestors.co.uk/companies/news/52486/barratt-strategy-paying-off-as-update-points-to-robust-financial-performance-52486.html …

Biggy........

16 Jan Barratt... BDEV Bank of America Merrill Lynch Buy 221.50 226.50 234.00 265.00 Retains

SP Target 265p

StockMarketWire.com
Numis cuts Barratt Developments to hold from buy, target 170p

BDEV

Broker upgrade report...

http://www.dailypolitical.com/finance/stock-market/deutsche-bank-reaffirms-buy-rating-on-barratt-developments-bdev.htm

Seems like the brokers cant make up their minds - BUY recommendation seems right to me with TP of 265... Buying pressure seems to be good this AM

Morgan downgraded the whole sector yesterday, but other brokers are a lot more optimistic.

If I read this RNS properly USB dropped BDEV 53,536,292 shares on 15th Jan 2013

?

Good start

Going well today.

The share has risen 125% in 2012 and more since the new year. Should have further upside. The company is in the enviable position of building on land it bought cheaply at the bottom of the cycle while selling its houses into a rising market. Debt levels along with write downs and off balance sheet financing have also subsided.