Investors breathed a sigh of relief after housebuilder Persimmon (PSN) confirmed its targets for profits and completions this year. However, the firm did point to rising inflation in its supply chain, led by higher energy costs, which it said could affect H2 earnings.
No material impact, yet
Persimmon said the volume of net private sales per outlet per week had increased by 3% in the first four months of 2026. By value, private forward sales so far this year were up 7% from £1.68 billion to £1.8 billion thanks to higher selling prices.
CEO Dean Finch said the Middle East conflict and resulting geopolitical uncertainty had not had a ‘material’ impact on trading. He did, however, admit there could be an effect on consumer confidence, as well as noting rising inflationary pressure.
‘We are carefully monitoring the situation, driving sales and maintaining a rigorous focus on cost control and cash generation,’ said Finch. ‘Our strong brands, unique vertically integrated model and high-quality landbank continue to differentiate Persimmon,’ added Finch.
Assuming market conditions don’t materially deteriorate, the company expects pre-tax profit to meet the £462 million consensus. It also repeated its target of 12,000 to 12,500 completions, with over half of private homes and almost all housing association homes already secured.
Persimmon is in a better position than most developers, with a good proportion of this year’s completions already booked. It is also still raising prices, whereas some firms have had to resort to lowering prices or using more incentives.
However, the shares have only added 2% on today’s update and are still down over 20% since the start of the year. This supports the old saw, it’s better to own a bad company in a good sector than a good company in a bad sector.
Persimmon is considered one of the best stocks, if not THE best stock in the housebuilding sector. Even so, shareholders are sitting on hefty losses this year.
In contrast, some lesser-quality energy and technology names have returned 20% or more this year. Even some consumer defensive and consumer cyclical stocks have done better than housebuilders.
Read the press release here:
https://www.persimmonhomes.com/corporate/investors
