Purplebricks has been upgraded from ‘sell’ to ‘neutral’ by analysts at UBS.
In a guidance note to investors, the bank said that it sees Purplebricks growing its market share in the UK from 5.8% to 7.5% by the 2024 financial year.
While this falls short of the company’s target of 10%, UBS hints that Purplebricks could change its pricing model.
UBS says: “Key to reaching guidance is a rebound in the housing market or a change in the pricing model which brings in additional instructions through the reduction of the upfront commitment.”
UBS has also upped its guidance for Purplebricks’ share price from 100p to 110p.
It said that a possible upside for the shares would be for Purplebricks to have “strategic value in the UK” as the dominant hybrid estate agent, as well as achieving new targets in the UK and Canada.
UBS also said that Purplebricks might exit from the US via a sale rather than a closure.
The analysts said they had more confidence in the new management at Purplebricks who they described as open to changing the pricing and agent remuneration model, along with improving other features such as the customer experience and agent productivity.
The Bruce brothers, founders of Purplebricks, have both left the company in recent weeks.
Yesterday, Purplebricks shares barely moved, closing at about 111p.