Foxtons Group is London’s leading and most widely recognised estate agency. It operates from a network of 57 interconnected branches offering a range of residential-related services which are split into three separate revenue streams: sales, lettings and mortgage broking.
Foxtons is almost entirely focused on the London market where both the lettings and sales markets are recovering as London and the rest of the UK, head towards a ‘new normal’. Foxtons’ Greater London region contains 13% of the UK population and by value accounts for 33% of sales and 38% of UK lettings.
Real Estate
Real Estate
Chris Hough
CFO
Guy Gittins
CEO
Nigel Rich
Chairman
Forecast net cash (£m)
8.1
Forecast gearing ratio (%)
N/A
% | 1M | 3M | 12M |
---|---|---|---|
Actual | (0.3) | (6.0) | (5.5) |
Relative | 2.0 | (2.0) | (4.5) |
52 week high/low | 44.0p/27.4p |
Foxtons Group’s Q1 trading update highlighted increased revenue per transaction and market share gains, evidence of early progress in rolling out the new strategy – characterised by upgrades to data infrastructure, investment in staff and a reinvigoration of the Foxtons brand. If the strategy succeeds, over the medium term Foxtons expects margins to expand by 500bp and operating profit to more than double. We retain our base case valuation of 59p/share and our preferred ‘bull’ case valuation of 124p/share, more than three times the current price.
Y/E Dec | Revenue (£m) | EBITDA (£m) | PBT (£m) | EPS (fd) (p) | P/E (x) | P/CF (x) |
---|---|---|---|---|---|---|
2021A | 126.5 | 25.1 | 10.0 | (0.52) | N/A | 19.4 |
2022A | 140.3 | 27.8 | 13.7 | 3.543 | 11.1 | 8.1 |
2023E | 137.8 | 26.7 | 13.5 | 3.586 | 11.0 | 8.9 |
2024E | 146.5 | 30.0 | 17.8 | 4.597 | 8.6 | 6.8 |
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