Two 59%+ winners, four above 25% in Aug – How this AI model keeps picking winners
Investing.com -- Shares of Bellway (LSE:LON:BWY) tumbled 5.5% today despite the company reporting an increase in home completions and a robust sales rate in its first half of 2025 trading update.
The property developer announced completions of 4,577 homes, marking an 11.9% rise year-on-year (YoY), and a private sales rate increase of 18.6% YoY.
The British homebuilder’s trading update, covering the period ending January 31, 2025, showed a slight increase in average selling prices (ASP) to £310.6k, up 0.4% from the previous year.
Bellway also reported a significant expansion in its land contracting, securing 5,246 plots compared to 1,237 in the first half of the prior year. The forward order book value saw a substantial 30% YoY increase to £1,311.5m, with the order book ASP 9% higher YoY.
Despite these positive indicators, Bellway’s stock experienced a decline, which may reflect investor concerns over the broader economic environment and its potential impact on the housing market. The company noted that while mortgage interest rates have increased modestly, customer demand has remained robust.
Bellway also highlighted a seasonal pick-up in customer inquiries and reservation rates at the start of the spring selling season but acknowledged the market’s sensitivity to mortgage affordability.
Looking forward, Bellway reiterated its full-year guidance for fiscal year 2025, projecting at least 8,500 home completions with an underlying operating margin approaching 11%. This guidance aligns closely with market consensus estimates.
RBC analysts expressed surprise at the stock’s underperformance given the company’s strong half-year results, stating, "At the half-way mark Bellway is on track to deliver on its full-year guidance. The robust performance of the Group is at odds with its subdued share price performance.
The underlying housing market appears to us to be stronger than investors think it is. Mortgage rates have ticked up since Bellway announced its two-year growth plans, but customer demand has remained firm and Bellway remains confident about delivering on its growth expectations for the full year."
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.