Forward Orders Slow for Bellway Amid Ongoing Housing Market Uncertainty; Shares Appeal

Ahead of its fiscal 2023 half-year result, Bellway updated the market in respect of a number of its key half-year performance metrics. The update provided us with little surprise with the no-moat U.K. homebuilder delivering 5,695 home completions in the first half of fiscal 2023, a flat year-on-year outcome. The group’s average selling price, or ASP, rose a modest 1.6% as sales mix shifted toward lower-priced affordable home completions, partially offsetting the positive influence that year-on-year U.K. house price gains had on the ASP. While our long-term expectations for the no-moat stock remain unchanged, a time value of money adjustment leads us to raise our fair value estimate by about 2% to GBX 3,750.