This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.
Shares in Persimmon (PSN) are topping the blue-chip leader board this morning thanks to a strong FY trading update that highlighted revenues +8%, selling volumes and prices both +4% and expansion in gross margin. The well-received update from management has seen bullishness among investors push the shares above their recent highs and 200-day moving average – a technical hurdle since late August – dragging peers along with it.
This latest positive update from a sector major adds to yesterday’s positive UK PMI Construction read and improving mortgage approvals data while the UK mortgage market remains highly competitive and government initiatives supportive. Although house price data does remain notoriously mixed, the post-Brexit crash foreseen by many simply hasn’t materialised and prices held up remarkably well. A near doubling in cash is never a bad thing either, especially when the stock already yields an attractive 6%.
A tasty recipe for shares in a company building on an island where space is at a premium and homeownership takes priority over marriage and children.
Mike van Dulken, Head of Research, 5 Jan
This research is produced by Accendo Markets Limited. Research produced and disseminated by Accendo Markets is classified as non-independent research, and is therefore a marketing communication. This investment research has not been prepared in accordance with legal requirements designed to promote its independence and it is not subject to the prohibition on dealing ahead of the dissemination of investment research. This research does not constitute a personal recommendation or offer to enter into a transaction or an investment, and is produced and distributed for information purposes only.
Accendo Markets considers opinions and information contained within the research to be valid when published, and gives no warranty as to the investments referred to in this material. The income from the investments referred to may go down as well as up, and investors may realise losses on investments. The past performance of a particular investment is not necessarily a guide to its future performance. Prepared by Michael van Dulken, Head of Research
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