Broker snap: Prime Markets sees more upside at Bovis Homes

19th Aug 2013 11:18

Prime Markets recommends to 'buy' shares of housebuilder Bovis Homes following Monday's interim report which showed strong momentum and a decent outlook for the full year.Profit before tax totalled £18.6m in the six months to June 30th, up 19% on the £15.6m reported the year before. This was helped by a 15% increase in the average sales price and an 80 basis-point improvement in operating margins. Housing revenue rose 17% from £157.1m to £183.2m."Today's half-year results confirms the growth momentum not only remains, but has if anything accelerated, with profits up, revenues up and with the group now 90% sold for legal completions in 2013," said Prime Markets' Head of Dealing Richard Curr."This of course means the South East-focused housebuilder should enter 2014 with a bulging forward order book, which for investors should mean a push for new year highs for the share price."In terms of technical analysis, Curr said that the shares have remained in a rising trend channel throughout 2013, recently testing the 100-day moving average (MA) support levels at 769p.As long as the shares close above the current 100-day MA, the broker expects a retest of its price target of 850p (reached last month), followed by a steady rise towards 900p in the next two to three months. The stock was up 0.72% at 784.1p by 11:25 on Monday.BC