Persimmon – Building Profits

0
Persimmon – Building Profits
liggraphy / Pixabay
  • Persimmon plc (LON:PSN), one of the UK’s leading house building groups has reported interim profits of £480m today, a jump of 64%.

Get Our Icahn eBook!

Get our entire 10-part series on Carl Icahn and other famous investors in PDF for free! Save it to your desktop, read it on your tablet or print it! Sign up below. NO SPAM EVER

Q2 2021 hedge fund letters, conferences and more

  • Sales volumes jumped by almost 50%, compared to a lockdown-impacted performance in 2020 and the group successfully managed cost pressures to see margins rise by a full percentage point.
  • The shares were little changed in early trading.

Persimmon Is Upping Their Pace Of Land Buying

Commenting on the results, Steve Clayton, HL Select fund manager said:

Contrarian Investor Conference: Short thesis for Momentus

MomentusThe space sector has captured the imagination and the pocketbooks of Wall Street as big names like Virgin Galactic rocket higher. However, not every name in the space sector is a good play. In fact, the Securities and Exchange Commission has gone so far as to name one space company a fraud. Q3 2021 hedge Read More

“We hold Persimmon in our HL Select UK Income Shares fund because of its strong cash generation abilities that leave it well placed to pay dividends back to shareholders. We’ve seen that ability today, with cash generation closely matching profits, allowing the group to return 225p per share so far this year.

The group are upping their pace of land buying to keep up with buoyant consumer demand for new homes. In the first half the group added 10,272 plots to the landbank, compared with new home completions of 7,406.

Land-buying is a key strength for the group and goes a long way to explaining how a business that sells its homes at an average price of £258k, some 15% below the national average, can still report profit margins of almost 28%. Quite simply, Persimmon have built a landbank of 85,000 plots that looks set to generate high returns as it is built out, for many years to come. Maintaining the built-in profitability of the landbank is probably the group’s number one challenge longer term.”


About Hargreaves Lansdown

Over 1.64 million clients trust us with £135.5 billion (as at 30 June 2021), making us the UK’s largest digital wealth management service. More than 98% of client activity is done through our digital channels and over 600,000 access our mobile app each month.

Updated on

Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver
Previous article Industry Reaction To The Latest UK House Price Index
Next article Balfour Beatty – London Property Blots An Already Unexceptional Copy Book

No posts to display