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Financial trading blog

Thursday, December 04, 2014
Connor Campbell - Market Analyst at Spreadex

Stock of the day 04/12/2014 – The Berkeley Group Holdings PLC

Based on its recent performance, there have been rumours The Berkeley Groups Holdings could become the fourth house-building company to join the FTSE100, as it looks to upgrade itself from the slightly less elite FTSE250. After peaking in February at 2809.5, share prices stabilised for much of the year between 2200 and 2400. The mid-October slump felt across the FTSE didn’t leave The Berkeley Group Holdings unscathed, causing a 2014 low of 2033.5.

However, the company quickly rallied to reach a second-half high of 2595.5 at the start of the week; then came George Osborne’s shock inclusion in his Autumn Statement. Shares in the company suffered a blow after the announcement of the stamp duty charges reform, falling 3.17% to 2462.5. Investors were spooked by the changes that will result in higher tax for properties of a value higher than £1 million, a big worry for high-end developers like The Berkeley Group Holdings. The markets calmed on this issue by Thursday, seeing share prices right themselves somewhat as they traded much of the day around the 2500 mark.

However, with the interim results coming up, financial advisors have been reserved about the health of the stock. Currently analysts are shrugging their collective shoulders at the company’s stocks, with an ‘overweight’ rating from JP Morgan being joined by a ‘hold’ from Deutsche Bank and ‘neutral’ from Goldman Sachs and Citigroup. The only bright spot was a lone ‘buy’ from Numis.

As The Berkeley Group Holdings feel the pressure from George Osborne’s shock decision yesterday, it will be hoping that the widespread downgrading of its stock rating does not reflect an ominous earnings release tomorrow.

Berkeley Group Holdings Chart


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