Foxtons Group — Lettings good, Sales held back short term

Foxtons Group’s Q325 revenue growth was clearly affected by the loss of consumer confidence in the sales market. We, and the company, believe this will probably continue until the end of the year, given the unhelpful headlines relating to potential tax increases in the Autumn Budget and the slower-than-hoped-for decline in interest rates. We have reduced our profit estimates and valuation as a result. However, we believe Foxtons’ strategic direction remains positive, and the internal initiatives previously outlined will bear fruit. Furthermore, the revised medium-term financial targets announced in June are ambitious but achievable, underpinned by structural growth, headquarter-related cost savings, Foxtons’ technology stack and its proprietary data vault.