Analysts at the bank hiked the price target to 6,620p from 4,540p.
“The current share price, in our view, is not fully pricing-in the improvement in near-term London housing market as the well wider south-east housing market and long-term prospects,” analysts commented.
The FTSE 100-listed housebuilder takes the smallest hit from the ‘Help to Buy’ scheme among its peers, as it comprised only 8% of completions in the year to last April and 12% in the first half of 2020.
Berkeley’s strategy of land-buying and regeneration schemes is expected to yield “stable” earnings and a return on capital of 26-27% over the next four years.
Analysts’ top picks
As post-election clarity lifts the market, analysts at HSBC set their preference on players focused on the south-east market.
Recommendations for all four were maintained at ‘buy’.
Shares in Berkeley rose 2% to 5,846p on Wednesday at noon.