Persimmon (LON:PSN) Announces Earnings Results

Persimmon (LON:PSN) posted its quarterly earnings data on Thursday. The company reported GBX 38 earnings per share (EPS) for the quarter, Digital Look Earnings reports. Persimmon had a return on equity of 8.05% and a net margin of 7.62%.

Here are the key takeaways from Persimmon’s conference call:

• Persimmon delivered strong first-half growth, with completions up 13% to 5,189, underlying operating profit up 10% to £189 million, and underlying PBT up 3% to £170 million. Growth was supported by higher volumes, overhead discipline, and increased first-time-buyer sales.
• The company raised full-year completion guidance to around 12,500 homes, the top end of its previous range, supported by a £1.9 billion forward order book, a 5% increase in the private order book, and an affordable housing order book fully secured for the year.
• Gross margin declined to 18% due to a less favorable affordable-housing mix, higher incentives, and build-cost inflation, with management expecting continued margin pressure through the second half and into 2027. Persimmon estimates an additional £40 million–£50 million cost impact over the next 18 months, partly linked to the Middle East conflict.
• Management highlighted substantial medium-term growth capacity, including nearly 81,000 owned and controlled plots, around 93,000 strategic-land plots including recent promoter acquisitions, and plans to open at least 100 outlets this year. The company remains focused on reaching at least 300 outlets and achieving a 20% operating margin and ROCE over the medium term.
• Recent trading softened modestly, with the private sales rate excluding bulk falling to 0.59 over the last five weeks, although the total private forward order book rose 5%. Building-remediation work remains a cash and execution consideration, with £206 million provisioned and ongoing cost-recovery efforts from the supply chain.

Persimmon Trading Up 2.9%

LON:PSN traded up GBX 32.50 during trading hours on Thursday, hitting GBX 1,155.50. The company had a trading volume of 2,987,045 shares, compared to its average volume of 12,855,734. Persimmon has a 1 year low of GBX 947.40 and a 1 year high of GBX 1,552. The company has a market cap of £3.71 billion, a P/E ratio of 13.10, a P/E/G ratio of 0.83 and a beta of 1.39. The company has a 50-day moving average of GBX 1,074.43 and a 200 day moving average of GBX 1,186.51. The company has a current ratio of 3.99, a quick ratio of 1.04 and a debt-to-equity ratio of 0.46.

Analysts Set New Price Targets

Several brokerages recently commented on PSN. Citigroup dropped their price target on Persimmon from £161.50 to £128 and set a “buy” rating for the company in a research report on Tuesday, June 23rd. Jefferies Financial Group restated a “buy” rating and issued a GBX 1,591 price objective on shares of Persimmon in a report on Thursday, April 30th. JPMorgan Chase & Co. lowered their target price on shares of Persimmon from GBX 1,800 to GBX 1,430 and set an “overweight” rating on the stock in a research note on Tuesday, June 16th. Finally, Panmure Gordon reaffirmed a “buy” rating and set a GBX 1,694 target price on shares of Persimmon in a report on Friday, May 1st. Eight research analysts have rated the stock with a Buy rating and two have assigned a Hold rating to the stock. Based on data from MarketBeat.com, the stock has an average rating of “Moderate Buy” and a consensus price target of GBX 2,606.

Insider Buying and Selling at Persimmon

In related news, insider Dean K. Finch sold 60,000 shares of the company’s stock in a transaction dated Tuesday, May 26th. The shares were sold at an average price of GBX 1,119, for a total value of £671,400. Insiders own 2.63% of the company’s stock.

Persimmon Company Profile

Persimmon Plc, together with its subsidiaries, operates as a house builder in the United Kingdom. The company offers family housing under the Persimmon Homes brand name; housing under the Charles Church brand name; and social housing under the Westbury Partnerships brand name. It also provides broadband services under the FibreNest brand; and timber frame, insulated wall panels, and roof cassettes under the brand Space4. Further, it offers concrete bricks and roof tile. Persimmon Plc was founded in 1972 and is headquartered in York, the United Kingdom.