Barratt Developments Plc (LON:BDEV) shares have plummeted in Wednesday morning trading, a day after UBS held its buy rating on the stock…
Housebuilding companies made strong gains yesterday after reports that the Right to Buy subsidies may be continued. This prompted Swiss bank UBS to reassess companies within the sector, saying that the industry could see a potential 22% upside in shareholder returns. They went on to state that they see demand improving and house prices remaining stable despite the current environment being shaky due to the coronavirus pandemic.
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The Right to Buy reports led to UBS rating Barratt Developments as unchanged, leaving the stock rating as a buy, and setting a price target of 680 GBX, which yesterday represented a potential 30.8% rise. Barratt’s stock is down by 29.26% for the year-to-date.
However, as of Wednesday morning, it seems investors haven’t taken UBS’ advice as the stock has fallen another -4.25% in early trading. It is currently sitting at 518 GBX, almost wiping out yesterdays gains.
Barratt’s stock price is still some way off of February’s highs of 799 GBX, and at this moment in time, even UBS’ target of 680 GBX looks doubtful.