Rightmove Gains on Property Search as UBS Says Buy: London MoverPeter Woodifield
Rightmove Plc, owner of the U.K.’s largest residential property website, rose the most in more than five months after UBS AG upgraded the stock and raised its 12-month price prediction by almost 13 percent.
Growth in revenue from advertisers at the same rate as Rightmove achieved last year would lead to a 13 percent increase in earnings estimates, Alex Hugh, a UBS analyst, said in a note to clients. Hugh raised his recommendation to buy from neutral and increased his price target to 1,800 pence from 1,600 pence.
U.K. homebuilders are forecasting that sales will continue to rise this year as Bank of England efforts to boost mortgage lending encourage more people to make purchases. The number of sellers coming to market so far this month is 22 percent higher than a year ago, Rightmove, whose customers are real estate brokers and homebuilders, said yesterday.
The shares rose 2.8 percent to 1,599 pence, the biggest advance since Aug. 10 at the close of trading in London. That extended Rightmove’s gain this year to 11 percent.
Rightmove’s dominance of Internet searches for property during the housing slump since the start of the global financial crisis has resulted in a ninefold increase in its share price since the end of 2008.
Viewing figures suggest that Rightmove’s competitive position remains as strong after property website Zoopla Ltd. combined with Digital Property Group Ltd., Hugh said. “There is always a competitor to worry about,” he said, noting that another site, PropertyLive, has closed.
The UBS upgrade was the second in four days. Gareth Davies, an analyst at Numis Securities Ltd., lifted his recommendation to buy from add on Jan. 18 and increased his price target to 1,866 pence from 1,776 pence.