Broker boosts Bellway

British homebuilder Bellway is up 3.5%, after the stock was upgraded by US broker JP Morgan Chase.

Bellway is trading at 1316p, up 3.5% on the day, after the investment bank reiterated an ‘overweight’ rating of the stock. Not only did the firm confirm its buy rating, but it also issued a price target of 1450p. On Monday of last week Deutsche Bank maintained its ‘hold’ rating for the company, and the German finance house has given a price target of 1503p for the housebuilder.

Bellway has performed well over the past year, and the stock has risen 41% in the past 12 months. Increased lending to homebuyers by banks, along with the government’s ‘help to buy’ scheme, has boosted the share price. During the credit crisis of 2008 the stock was hit hard, as reduced liquidity made it difficult for customers to get mortgages. This morning it was revealed that the number of mortgages in the UK is now at its highest level since February 2008, indicating an increased appetite from homebuyers. The government’s scheme is assisting first-time buyers to get on the property ladder, and Bellway is benefiting from this initiative as the properties must be new developments.

Bellway plc chart

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