Jefferies, a major City adviser, is downgrading its 2016 estimate for Countrywide’s performance over the rest of this year.
In a statement this morning it said that as a result of weak transactions, Brexit uncertainty, stamp duty dampening the high end of the market and Countrywide’s decision to scale back its expansion plans, it was downgrading Countrywide’s status from ‘Buy’ to ‘Hold’.
Jefferies said this morning: “The UK housing market and political landscape have changed significantly since the [Countrywide] 'Building Our Future Strategy' was launched one year ago. In our view, it is no longer the right time for mergers and acquisitions. We have therefore scaled back our assumptions on M&A activity, which was a significant part of the expansion strategy. We have also reduced margins to reflect the fact that when housing transactions slow, operational gearing turns from friend to foe.”