Panmure names Bovis Homes as top pick among housebuilders

18th Aug 2014 10:42

Bovis Homes remains Panmure Gordon's top pick in the housebuilding sector after a "positive set of interim results" on Monday.Pre-tax profit in the six months to 30 June totalled £49.4m, up 166% over the year before, on revenues that jumped 75% to £322.1m, as completions reached a record level and sales prices improved. Operating margins climbed by 480 basis points year-on-year to 15.9%.The interim dividend was hiked by 200% to 12p and the company signalled its intention to pay an "enhanced dividend" of 35p (total) this year and 35p thereafter, compared with 13.5p in 2013."Bovis has issued a strong results update, with strong growth in revenues, margins, earnings and dividends at the group," said Panmure analyst Rachael Applegate."Along with a positive outlook statement, the group has outlined its future strategy including a programme of enhanced dividend payments. This newsflow is likely to be taken positively in our view."The broker kept a 'buy' recommendation and 953p target price for the stock, which had jumped 5.1% to 842.5p by 11:09.BC