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Persimmon
(LSE:PSN)
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Rating:66Neutral
Price Target:
1,430.00 p
▲(18.62% Upside)
Action:Reiterated
Date:09/29/26
Overall score reflects a strong balance sheet and supportive valuation/dividend, tempered by weak recent cash generation and structurally lower margins. Technicals are positive but somewhat overextended, while earnings call guidance is steady with solid order book visibility but ongoing cost/margin and remediation risks.
Positive Factors
Strong balance sheet and low leverage
Very low leverage and a substantial equity cushion give Persimmon resilience through housing-market cycles. This financial capacity can support land investment, absorb operational volatility, and preserve strategic flexibility while the company works through changing demand and construction conditions.
Negative Factors
Structural margin compression
The sustained reduction in gross and net margins shows that earnings quality remains below prior-cycle levels. Lower profitability leaves less room to absorb build-cost inflation, incentives, product-mix changes, or pricing pressure, making future earnings more dependent on volume and cost control.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong balance sheet and low leverage
Very low leverage and a substantial equity cushion give Persimmon resilience through housing-market cycles. This financial capacity can support land investment, absorb operational volatility, and preserve strategic flexibility while the company works through changing demand and construction conditions.
Read all positive factors
Persimmon (PSN) vs. iShares MSCI United Kingdom ETF (EWC)
Market Cap
£3.95B
Dividend Yield4.88%
Average Volume (3M)2.37M
Price to Earnings (P/E)13.0
Beta (1Y)1.46
Revenue Growth17.38%
EPS Growth18.92%
CountryUK
Employees4,605
SectorConsumer Cyclical
Sector Strength84
IndustryResidential Construction
Share Statistics
EPS (TTM)0.95
Shares Outstanding321,333,100
10 Day Avg. Volume1,794,995
30 Day Avg. Volume2,373,465
Financial Highlights & Ratios
PEG Ratio2.56
Price to Book (P/B)1.20
Price to Sales (P/S)1.16
P/FCF Ratio-362.38
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
£1,366.00Price Target Upside13.31% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
EPS Forecast (FY)1
Revenue Forecast (FY)£4.01B
Persimmon Business Overview & Revenue Model
Company Description
Operating across the United Kingdom, Persimmon Plc, through its subsidiaries, is a leading residential developer. The company constructs various types of homes, including family properties under the Persimmon Homes brand, executive residences thro...
How the Company Makes Money
Persimmon primarily makes money by developing residential land into new-build housing and selling completed homes. Its core revenue stream is the sale of private homes to owner-occupiers (often funded by residential mortgages), where Persimmon cap...
Persimmon Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Mar 03, 2027
Earnings Call Sentiment Positive
The call highlights strong volume-led growth, improved operating profit, a robust land and planning pipeline, and operational progress (vertical integration, remediation progress and first-time buyer outperformance). However, there are meaningful near-term margin pressures from embedded build cost inflation, geopolitical-driven incremental costs (GBP 40–50m estimate), slightly higher incentives, some short-term sales softening and ongoing remediation liabilities. Management is confident in mitigating costs through self-help measures and expects to hit full-year volume guidance, while maintaining balance sheet discipline and continuing shareholder returns.Positive Updates
Volume Growth and Completions Increase
New home completions rose 13% year-on-year to 5,189 (H1), and are up 22% versus three years ago; management now expects full-year deliveries to be around 12,500 homes (top end of prior guidance).
Negative Updates
Gross Margin and Margin Headwinds
Gross margin and site-embedded margin pressured by product mix (higher affordable housing share), incentives and build cost inflation. Operating margin reduced from 13.1% to 12.8% and management noted a ~210 bps hit to gross margin from mix, incentives and inflation.
Read all updates
Q2-2026 Updates
Positive
Negative
Volume Growth and Completions Increase
New home completions rose 13% year-on-year to 5,189 (H1), and are up 22% versus three years ago; management now expects full-year deliveries to be around 12,500 homes (top end of prior guidance).
Read all positive updates
Company Guidance
Guidance reiterated that Persimmon expects to deliver around 12,500 homes in 2026 (the top end of prior guidance) with underlying PBT “in line with current expectations/consensus” and year‑end net cash broadly in line with previous guidance (adjusted gearing could be ~20%); the group cites a strong forward book of £1.9bn (private forward book £1.3bn, up 5%, ~8% sold for the year) and an affordable order book of £600m fully secured. Operationally H1 delivered 5,189 completions (up 13%), 4,261 private completions (up 7%), net private weekly sales 205 (up 7%), a five‑week private sales rate of 0.72 including bulk (0.59 excl bulk), blended ASPs +1% (private ASPs +3%) and incentives ~5%; H1 underlying PBT was £170m (up 3%), underlying operating profit £189m (up 10%) with an operating margin of 12.8%, gross profit £267m and housing revenue ~£1.5bn. Balance sheet and other metrics supporting the guidance include net debt of £165m at 30 June, PX stock £168m, owned/controlled plots ~81,000 (strategic/promoter plots ~93,000), 6,123 plots with detailed planning (118% of H1 completions), remediation provision £206m (H1 spend £24m, targeting ~£100m this year), ROCE 11.3%, underlying EPS 38p, interim dividend 20p and a minimum annual capital return policy of 60p.Persimmon Financial Statement Overview
Summary
Income Statement
58
Neutral
Balance Sheet
88
Very Positive
Cash Flow
34
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.98B | 3.75B | 3.20B | 2.77B | 3.82B | 3.61B |
| Gross Profit | 581.30M | 616.50M | 580.40M | 795.10M | 867.50M | 1.08B |
| EBITDA | 471.70M | 431.10M | 393.00M | 385.30M | 738.20M | 973.50M |
| Net Income | 305.50M | 285.70M | 267.10M | 255.40M | 561.00M | 787.20M |
Balance Sheet | ||||||
| Total Assets | 5.48B | 5.32B | 4.83B | 4.79B | 5.03B | 4.79B |
| Cash, Cash Equivalents and Short-Term Investments | 110.00M | 117.00M | 258.60M | 420.10M | 861.60M | 1.25B |
| Total Debt | 291.80M | 16.80M | 453.60M | 392.70M | 498.00M | 436.90M |
| Total Liabilities | 1.86B | 1.70B | 1.33B | 1.37B | 1.59B | 1.17B |
| Stockholders Equity | 3.61B | 3.61B | 3.51B | 3.42B | 3.44B | 3.63B |
Cash Flow | ||||||
| Free Cash Flow | -157.10M | -12.00M | 52.60M | -166.20M | 371.80M | 763.90M |
| Operating Cash Flow | -130.70M | 28.60M | 84.90M | -129.80M | 402.30M | 784.80M |
| Investing Cash Flow | 38.40M | 26.80M | -45.00M | -42.90M | -29.80M | -18.20M |
| Financing Cash Flow | 79.30M | -197.00M | -201.40M | -268.80M | -757.50M | -754.10M |
Persimmon Technical Analysis
Positive
1205.50
Price Trends
1181.51
Positive
1124.00
Positive
1150.38
Positive
Market Momentum
32.64
Negative
67.62
Neutral
97.80
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:PSN, the sentiment is Positive. The current price of 1205.5 is below the 20-day moving average (MA) of 1239.56, above the 50-day MA of 1181.51, and above the 200-day MA of 1150.38, indicating a bullish trend. The MACD of 32.64 indicates Negative momentum. The RSI at 67.62 is Neutral, neither overbought nor oversold. The STOCH value of 97.80 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:PSN.
Persimmon Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | £2.72B | 11.20 | 5.99% | 5.28% | 9.47% | 193.33% | |
68 Neutral | £4.29B | 18.33 | 3.13% | 1.90% | 8.55% | 26.47% | |
68 Neutral | £3.08B | 10.24 | 8.79% | 6.88% | -4.15% | -10.86% | |
66 Neutral | £3.95B | 12.95 | 8.45% | 4.88% | 17.38% | 18.92% | |
64 Neutral | £2.37B | 12.78 | 5.49% | 3.37% | 13.63% | 26.37% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
55 Neutral | £825.14M | -1.65 | -16.57% | 7.03% | -7.99% | -5071.71% |
* Consumer Cyclical Sector Average
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Persimmon Corporate Events
Regulatory Filings and Compliance
Persimmon Confirms Share Capital and Voting Rights Total
Neutral
Sep 1, 2026
Persimmon has confirmed that its issued share capital as of 31 August 2026 comprises 321,295,378 ordinary shares of 10 pence each, with no shares held in treasury, resulting in an equal number of total voting rights. The company noted that this vo...
Business Operations and StrategyDelistings and Listing ChangesRegulatory Filings and Compliance
Persimmon Issues New Shares to Satisfy Employee Awards
Neutral
Sep 1, 2026
Persimmon Plc has issued and admitted to trading 25,483 new ordinary shares of 10p each during August 2026 to satisfy vested awards granted under its employee share schemes. Following this issuance, the company’s total number of ordinary sha...
Business Operations and StrategyFinancial Disclosures
Persimmon lifts first-half profits and output as it targets upper-end 2026 growth
Positive
Aug 6, 2026
Persimmon reported a strong first half, increasing home completions by 13% to 5,189 and lifting new housing revenue by the same proportion to £1.48bn, while underlying operating profit rose 10% to £189.1m despite a slight margin decline....
Business Operations and StrategyRegulatory Filings and Compliance
Persimmon Adds Nearly 29,000 Shares to Satisfy Employee Awards
Neutral
Aug 3, 2026
Persimmon has issued and admitted to trading 28,963 new ordinary shares of 10p each during July 2026 to satisfy vested awards under its employee share schemes. The new shares, issued under existing block admissions, are fully fungible with existin...
Regulatory Filings and Compliance
Persimmon Confirms Updated Total Voting Rights
Neutral
Aug 3, 2026
Persimmon has confirmed that its share capital as of 31 July 2026 comprises 321,269,895 ordinary shares of 10p each, with no shares held in treasury. This means the total number of voting rights in the company stands at 321,269,895, providing a cl...
Business Operations and StrategyRegulatory Filings and Compliance
Persimmon Adds 48,838 Shares to Fulfil Employee Awards
Neutral
Jul 1, 2026
Persimmon Plc has issued and admitted to trading 48,838 new ordinary shares of 10p each during June 2026 to satisfy vested awards under its employee share schemes. Following this issuance, the total number of Persimmon ordinary shares admitted to ...
Regulatory Filings and Compliance
Persimmon Confirms Total Voting Rights and Share Capital Structure
Neutral
Jul 1, 2026
Persimmon has confirmed that, as of 30 June 2026, its issued share capital comprises 321,240,932 ordinary shares of 10 pence each, with no shares held in treasury, resulting in an equal number of voting rights. The disclosure clarifies the current...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.