While shares in Henry Boot (BHY), a company that specialises in bringing land through the planning process and selling it on to hungry builders, have been battered about by referendum jitters, we think the stock is a winner which ever way the vote goes. Indeed, even in the supposedly uncertain pre-referendum conditions, the company has been selling more land than expected at better-than-expected prices, fuelling earnings forecast upgrades. We would not expect a Brexit vote to derail this and a Remain vote may even improve already buoyant market conditions.
- Strong land sales
- Record pipeline of land schemes
- Shares modestly rated
- Low gearing
- High plant hire renewal costs
- Planning constraints remain
Demand for Boot's 'oven-ready' land is pretty broadly based, and includes space for warehouses, offices and leisure as well as homes. And while the revenue stream can be a little lumpy, depending on when sales are completed, the underlying picture suggests that conditions in its end markets are strong.