Barratt Developments (BTDPY) AI Stock Analysis

Barratt Developments

(Other OTC:BTDPY)

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Rating:62Neutral

Price Target:$9.50▲(9.64% Upside)

Action:reiterated

Date:09/20/26

Barratt Developments' overall score of 62 reflects a company with a rock-solid financial foundation and strong cash generation, which are its most significant strengths. The earnings call confirms capable management is navigating the cycle well, with a major shareholder return program underway. However, the score is heavily constrained by a very high P/E ratio on depressed earnings and significant pressure on profit margins from cost inflation and pricing deflation. The stock offers a high dividend yield, but the technical picture is neutral, offering no clear catalyst. The investment case rests on the balance sheet's safety and the potential for a cyclical recovery in profitability.

Positive Factors

Conservative balance sheet and improving liquidityLow leverage and a move into net cash give Barratt Redrow financial flexibility through housing-cycle volatility. A stronger equity base and expanded liquidity reduce balance-sheet pressure, supporting continued investment, remediation funding and shareholder returns over the next several quarters.

Negative Factors

Margin compression from pricing and build-cost pressureLower selling prices, higher build costs and customer incentives are compressing profitability despite recovering volumes. Persistent margin pressure could keep earnings and returns below prior-cycle levels, limiting the benefit of revenue growth and making future performance more sensitive to pricing discipline.

Barratt Developments (BTDPY) vs. SPDR S&P 500 ETF (SPY)

Market Cap: $3.01B
Dividend Yield: 1.85%
Average Volume (3M): 19.42K
Price to Earnings (P/E): 18.8
Beta (1Y): 0.68
Revenue Growth: 12.59%
EPS Growth: 31.20%
Country: US
Employees: 7,334
Sector: Consumer Cyclical
Sector Strength: 61
Industry: Residential Construction

Barratt Developments Business Overview & Revenue Model

Company Description

Barratt Redrow Plc is a major property developer with operations primarily concentrated in the United Kingdom. The company specializes in creating a variety of real estate, encompassing both residential homes and commercial structures. Its extensive...

Barratt Developments Earnings Call Summary

Earnings Call Date:Sep 15, 2026(Q4-2026)|% Change Since:16.53%|Next Earnings Date:Feb 09, 2027

Earnings Call SentimentPositive

The call was cautiously positive. Management highlighted resilient trading, higher completions, completed Redrow integration, strong synergy delivery, a robust balance sheet, planned capital returns and early success from the multi-brand strategy. These positives were offset by lower profitability and margins, pricing deflation, building-cost inflation, building-safety liabilities, planning delays, affordability constraints and macroeconomic uncertainty. The positive operational execution and financial position significantly outweighed the stated challenges.

Positive Updates

Resilient FY2026 Performance

Barratt Redrow described its operational and financial performance as solid and in line with expectations despite challenging market conditions, supported by its brands, strategy, teams and supply chain.

Negative Updates

Challenging Market and Affordability Conditions

Management said market conditions were clearly challenging, customers were subdued, and first-time buyers faced severe affordability challenges. The industry also remains constrained by an under-resourced planning system, red tape, regulation and taxation.

Company Guidance

For FY '27, Barratt Redrow is confident in total completions of between 17,500 and 17,900, expects affordable volumes to return to around 20% of completions, joint venture completions to increase slightly to around 600 units, and average outlets to be stable at approximately 405; it is guiding to 3% to 4% inflation for the year, administrative expenses of approximately GBP 360 million, an annual profit and loss contribution from synergies of approximately GBP 95 million, land approvals of between 6,000 and 8,000 plots only if sufficiently attractive opportunities arise, and FY '27 year-end net cash between GBP 400 million and GBP 500 million, subject to any changes in land activity and guidance on that as the year develops. The company expects to spend approximately GBP 300 million on legacy property remediation and GBP 340 million settling line creditors, expects to spend approximately GBP 450 million in FY '28 on direct remediation-related works and payments to the Building Safety fund, and expects FY '27 total capital return to be GBP 400 million, with GBP 386 million delivered through a share buyback.

Barratt Developments Financial Statement Overview

Summary

Financial performance is a tale of two halves. The balance sheet is exceptional (Score: 85), with negligible debt and a massive equity base providing a fortress-like foundation. Cash flow has also rebounded powerfully (Score: 78), with excellent conversion of earnings into cash. However, the income statement (Score: 42) reveals significant margin compression, with profitability per pound of revenue well below historical peaks. The overall financial picture is of a very safe company navigating a cyclical profit trough.

Income Statement

42Neutral

Balance Sheet

85Very Positive

Cash Flow

78Positive

Financial statement breakdown
Breakdown	TTM	Jun 2026	Jun 2025	Jun 2024	Jun 2023	Jun 2022
Income Statement
Total Revenue	6.11B	6.03B	5.58B	4.17B	5.32B	5.27B
Gross Profit	886.56M	864.33M	784.80M	689.00M	1.13B	1.30B
EBITDA	584.70M	622.67M	416.50M	255.70M	767.00M	1.07B
Net Income	245.40M	242.26M	186.40M	114.10M	530.30M	515.10M
Balance Sheet
Total Assets	11.05B	11.05B	11.55B	7.88B	8.01B	8.22B
Cash, Cash Equivalents and Short-Term Investments	965.04M	965.04M	969.60M	1.07B	1.27B	1.35B
Total Debt	246.11M	246.11M	255.20M	242.80M	249.60M	254.40M
Total Liabilities	3.32B	3.32B	3.68B	2.44B	2.42B	2.59B
Stockholders Equity	7.73B	7.73B	7.87B	5.44B	5.60B	5.63B
Cash Flow
Free Cash Flow	462.24M	444.17M	11.20M	89.00M	498.70M	406.40M
Operating Cash Flow	474.54M	456.32M	29.30M	96.20M	521.80M	436.30M
Investing Cash Flow	-81.20M	-79.99M	195.80M	12.00M	55.40M	-241.10M
Financing Cash Flow	-379.04M	-375.04M	-320.80M	-308.60M	-590.60M	-378.40M

Barratt Developments Technical Analysis

Technical Analysis SentimentPositive

Last Price8.66

Price Trends

50DMA8.29Positive

100DMA8.02Positive

200DMA8.04Positive

Market Momentum

MACD0.13Negative

RSI55.76Neutral

STOCH35.70Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BTDPY, the sentiment is Positive. The current price of 8.66 is above the 20-day moving average (MA) of 8.29, above the 50-day MA of 8.29, and above the 200-day MA of 8.04, indicating a bullish trend. The MACD of 0.13 indicates Negative momentum. The RSI at 55.76 is Neutral, neither overbought nor oversold. The STOCH value of 35.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BTDPY.

Barratt Developments Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

BTDPY against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NVR	72Outperform	$15.88B	15.65	29.53%	―	-10.43%	-21.29%
PHM	69Neutral	$22.96B	13.27	13.80%	0.83%	-9.35%	-27.96%
LEN	65Neutral	$20.65B	16.43	6.03%	2.30%	-8.01%	-47.77%
DHI	64Neutral	$40.84B	14.38	12.22%	1.23%	-3.52%	-12.68%
BTDPY	62Neutral	$5.89B	18.78	3.13%	1.85%	12.59%	31.20%
Sector *	61Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
KBH	43Neutral	$2.91B	13.21	5.93%	2.09%	-20.80%	-50.30%

* Consumer Cyclical Sector Average

Performance Comparison

BTDPY and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
BTDPY	Barratt Developments PLC Unsponsored ADR	8.66	-0.86	-9.01%
DHI	D.R. Horton Inc	146.00	2.66	1.86%
KBH	KB Home	47.94	-12.05	-20.09%
LEN	Lennar Corporation	86.94	-31.01	-26.29%
NVR	NVR Inc	5958.56	-1113.76	-15.75%
PHM	Pultegroup	124.74	6.98	5.93%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Date of analysis: Sep 20, 2026

Barratt Developments AI Stock Analysis