More on Persimmon
Persimmon: Trading statement
Housebuilder Persimmon expects to report an 8% increase in turnover for the year to December 2005. Unlike many of its peers, Persimmon figures for the year look quite healthy; legal completions of 12,600 (a small increase from last years 12,360), higher average selling prices (£180,500 v £172,431), both of which have contributed to the increase in turnover.
Control of building costs and overhead efficiencies have preserved operating margins at a satisfactory level.
Sales in the autumn have apparently been good and the order book (at around £550m) is similar to last year’s level. The planned acquisition of Westbury, another listed housebuilder can provide further short-term upside.
Persimmon’s has performed well in fairly weak market and it seems likely to continue to outperform-in a sector that we expect to weaken in the medium term. Much of the growth does seem to be factored into its current share price of 1192p, putting it on a prospective PE (2006 earnings) of 9.1x, at the upper end of the sector range. The yield is 2.8%.
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