Canaccord Genuity raises target price on the Property Franchise Group

Canaccord stated that delivered against "a challenging economic backdrop" and a contraction in residential sales, TPFG's results demonstrated "the strength and quality" of the lettings business and its franchise model.

Revenue beat forecasts, driven by owned office revenue and financial services commissions, while management service fees of £15.9m were in line with expectations. Lettings contributed 55% of MSF, sales contributed 44% and financial services contributed 1%. Adjusted operating profits of £11.1m were 7% ahead of forecasts.

The Canadian bank also noted that TPFG's outlook stated that the seasonally quiet first quarter of 2023 had been "slightly ahead of management's expectations" with regard to both revenue and profitability.

"We understand this has largely been driven by strong lettings revenues, reflecting rental inflation in both new lets and in-tenancy inflation. Costs have also been managed well year-to-date," said the analysts, who stood by their 'buy' rating on the stock.

Reporting by Iain Gilbert at Sharecast.com