Analysts at Credit Suisse bumped up their target price for Berkeley Group Holdings after the company boosted its capital return programme, unveiled an increase in forward sales and management expressed confidence in the operating environment.
The homebuilder committed to returning £16.34 per share for the period until 2021, versus £13 per share previously.
Coming on top of the £4.34 per share already handed back to investors, that implied the group was on track to return £12 per share by 2021, equivalent to a run-rate of £2 per annum and equating to a 6% yield as of 4 December, analyst Harry Goad said in a research note sent to clients.
The firm also said forward sales had increased from £3.0bn to £3.1bn, he pointed out.
The overall tone of management’s description of current market conditions was “positive”, Goad added.
Current market conditions were described as having “good underlying demand in a stable operating environment”.
Goad left his ‘neutral’ recommendation in place and lifted his target price from 2,814p to 3,101p.