Foxtons Group — Q125 benefit from Stamp Duty pull forward

Foxtons Group’s Q125 trading update revealed revenue growth of 24%, driven predominantly by growth in the Sales division, which in turn benefited from a pull forward in transactions due to Stamp Duty changes. However, in the longer term, we believe the company’s strategic direction remains positive, and we expect an update on its strategy to be revealed at the 4 June capital markets day. This may see an upgrade to the medium-term adjusted operating profit target of £28–33m, which is now coming into focus. We maintain our revenue and operating profit estimates and our 134p/share valuation, although risks appear to be skewed to the upside if market momentum continues.