UK-based Vistry Group PLC’s (GB:VTY) shares have gained momentum after hitting their low point in October 2022. Despite experiencing some volatility at the beginning of 2023, the shares surged after the company increased its profit guidance for the full year. In the past five days, the shares have surged by 14% following the company’s confirmation of its annual profit figures. YTD, the shares have experienced a growth rate of 29%.
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Vistry Group is a construction company with a mission to create sustainable new homes and communities across all segments of the UK housing market. It operates in two main segments: Housebuilding and Partnerships.
Challenging Market Conditions with Steady Expectations
Last week, Vistry Group echoed its larger counterparts in acknowledging a deepening slowdown in the UK housing market. In the UK, higher interest rates have impacted housing demand and building rates, leading to warnings from housebuilders.
However, the company upheld its annual profit forecast and also revealed that its first-half figures are on track. The company witnessed a strong demand for affordable housing, protecting it from broader market shocks. Under its Partnerships business, the company develops affordable homes in collaboration with local government authorities and housing associations.
Vistry Group anticipates its pre-tax profit for 2023 to reach approximately £450 million, reflecting an 8% increase compared to the previous year. The number is mainly driven by its forward order book, advancements in integration, and cost savings.
Its housebuilding segment’s forward sales position remains strong, with 76% of 2023 units already secured. On the flip side, house completions declined by 22% to 2,847 units amid tougher market conditions. The company also issued a cautionary statement about the impact of “challenging market conditions” on first-time buyers.
Are Vistry Shares a Good Buy?
Overall, VTY stock has a Hold rating on TipRanks, with a total of nine ratings, which include three Buy, four Hold, and two Sell recommendations.
At an average price forecast of 800.3p, analysts are predicting a change of 0.73% in the share price.
