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Barratt


Fernando Palmer
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Hi Fernando and thanks for the question.

In relation to Barratt, there was no particular fundamental reason behind the stock price dropping 5% yesterday. The media reported that the most likely reason for a move lower is that the investors are concerned about the second wave that may create further damage to the real estate developers. As one of the biggest house constructors in the UK, Barratt may feel a lot of heat if another round of measures is introduced. 

 

A few days ago, Barratt said it will restart work at around 50% of its construction sites following PM Johnson’s urge to get back to work. 

“With the phased reopening of our sites, a significant proportion of our workforce will be able to return to work during May. We have created a detailed set of working practices and protocols for employees and sub-contractors to ensure that we can reopen our construction sites safely, in a phased and measured way, which minimises risk,” CEO David Thomas said. 

Hence, this plunge in price may be short-term as Barratt’s workers return to the construction sites. If you are looking to buy Barratt stock, then the £3.5 support offers a solid opportunity from the technical perspective.


 

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Hello Fernando, thanks for being here.

Shares of Barratt Development PLC advanced 5% Tuesday on the London stock exchange. The stock of the residential property development company closed the session at 499.2p. 

The rise in stock occurred after the company announced it purchased the Oregon Timber Frame, one of the UK's largest independent timber frame producers. Over the past three years, the company build roughly 5,500 homes including a timber frame construction, as reported by the Scottish Business News. Most of Barratt’s homes were built using a timber frame construction in Scotland, as well as in England and Wales. The news company believes that Barrat will make at least 20% of its homes utilizing this method.  

Barratt has enough resources to buy the materials from the suppliers, however, those suppliers set somewhat higher prices to make a profit. That’s why this acquisition is very significant for Barrat as it will help te company reduce raw material costs and remove the need to work with suppliers. Cutting costs will, of course, help the company boost its profit margins and pay more to the stockholders. 

“Barratt is committed to increasing the number of homes we build using offsite construction as part of our overall volume growth aspirations and to mitigate the current skills challenges facing the industry. Oregon is the perfect company to help us do that, with a highly experienced management team, a skilled workforce, and a high-quality product,” said the Chief Operating Officer of Barratt, Steven Boyes.

The company will attempt and achieve a 3% to 5% growth per year in wholly-owned home selection. Barratt already made a 2.6% increase compared to last year.

Hope I’ve helped!
 

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Hi Fernando,

There are some recent developments regarding Barratt’s stock. Several Canadian investors including RBC Global Asset Management, RBC Phillips, Hager & North Investment Counsel, RBC Private Counsel and Royal Trust Corporation of Canada have purchased a stake in Barratt Developments stock.

Together, these investors now own nearly 3% stake in the homebuilding company.

The deal happened after the Coalville-based company said it will pay back the money it got from the authorities which helped around 6,700 employees to keep their jobs during the coronavirus lockdown.

Barratt had to put nearly 85% of its staff on the Coronavirus Job Retention Scheme when all of its operations were halted in March.
 

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