Persimmon PLC
Spreadex | Aug 14, 2018 12:09
Will investors make Persimmon (LON:PSN) their home following next week’s half year results?
The housebuilder has certainly gotten around in 2018, if not always in the right direction. A sharp decline at the start of the year took the stock from an opening price of £27.41 to £23.75 by early February. The firm reversed this drop as winter turned into spring, surging to an all-time high – just – of £29.08 by the first week of June.
Yet that peak didn’t last for long. Mid-June saw the Persimmon and its peers take a hit, first from a disappointing Crest Nicholson (LON:CRST) update, and then news that house prices in London had continued to fall. This sent the stock into a downward spiral that has only recently stalled, with the company spending much of July and early August between £24.50 and £25. Persimmon PLC now sits at a current trading price of £24.51 (Spreadex, 14/08/2018).
In the midst of that summer decline came July’s trading statement – and it wasn’t that bad. For the 6 months to the end of June revenue rose 5% to £1.8 billion; a sharp comedown from the 12% growth seen in H1 2017, but still impressive given the softening situation in the London property market. Completions, meanwhile, were up 3.6% to 8072, with average selling price nudging 1.2% higher to £215,800.
Obviously now investors will want to know what all this means profit-wise, with last year’s 30% increase to £457.4 million the number to beat. They’ll also be after an update on the state of current trading, and any revised forecasts for the full year.
Persimmon PLC has a consensus rating of ‘Hold’ alongside an average target price of £27.31.
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