Purplebricks Exits U.S. After Shares Plummet 75% in Two Years

(Bloomberg) -- Purplebricks Group Plc‘s stock climbed after the online estate agent said it was pulling out of the U.S., marking an end to a 75% slump in valuation since it ventured across the Atlantic in September 2017.

Shares in the U.K. company that charges homeowners a fixed fee, whether or not a property is sold, have plummeted amid a deteriorating market at home and as expansion abroad deepened losses. The news comes on the heels of the company’s Australia exodus in May.

The stock gained as much as 5% Wednesday as analysts welcomed the decision to focus on the more-established U.K. and Canada regions. “We see group profitability in the short term as now likely, a significant divergence from expectations six months ago,” Citigroup Inc. analysts led by Kyle Twomey said in note.

Purplebricks said a “significant opportunity to disrupt the U.S. market,” remains, but it would take “substantially more management time and resources than the company is able to commit at this time.” The Solihull, England-based company reported a full-year operating loss in the country of 34.1 million pounds ($42.9 million), wider than the 16.8-million pound loss a year earlier.

To contact the reporter on this story: Joe Easton in London at jeaston7@bloomberg.net

To contact the editors responsible for this story: Beth Mellor at bmellor@bloomberg.net, Monica Houston-Waesch, John Viljoen

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