Galliford Try is going strong

The company will report its full-year results on 16 September, and the home builder is on track for record profits. 

Source: Bloomberg

Galliford Try’s share price has printed an all-time high today, and dealers have big expectations for the housebuilder. The sector as a whole has performed extremely well, and Galliford Try is one of the last home builders to announce its results this reporting season, while record profits and multi-year highs for stock prices have been regular occurrences.

Galliford Try has also stated it predicts full-year net profits to come in at the top end of estimates, which are between £105.9 million and £113 million, and that compares with net profit of £95.2 million.

As I outlined in the Barratt Developments article, a mixture of the Conservative government’s assistance to first time buyers, ultra low interest rates, and competition in the mortgage market has spurred on UK house prices.

Galliford Try currently stated in July it has an order book of £3.5 billion, and that is a considerable jump when compared with the £1.4 billion order book during the same period last year. This highlights how much work it has in the pipeline.

Traders are anticipating revenue of £2.2 billion and adjusted net income of £90.3 million when the company announces its annual results. These forecasts represent a 25% jump in revenue and an increase of 17% in adjusted net profit.

Equity analysts are bullish on Galliford Try, and out of the four recommendations, one is a buy, and three are holds. The average target price is £16.55, which is 9.3% below the current price. Investment banks are far more bullish on Taylor Wimpey. Out of the 17 ratings, 11 are buys, and six are holds. The average target price is 208p, which is 3.4% above the current price.

The stock has been rallying since 2009, and if the all-time high of £18.23 is exceeded then £20 will be the on the radar. Pullback in the stock will allow buyers to enter the market, and support will be found at £16.85. The next big level of support below that is £15.30. 

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