Here’s what you need to know
Persimmon has released a brief trading update ahead of its AGM later today.
The group has reported robust trading so far this year, with visitor levels, sales rates and cancellations all running in line with expectations.
The shares rose slightly on the news.
George Salmon, Equity Analyst at Hargreaves Lansdown:
“Increasing profits, a sizeable bank of land ready for development and a housing market with a supply-demand imbalance mean things don’t get much better for Persimmon. In a funny sort of way, that’s the worry. After all, history tells us these conditions won’t last forever.
However, the group has learned its lesson from the near-death experiences of the last crisis, and has built up huge cash reserves during the more recent boom years. While another housing downturn would still likely hurt the shares, Persimmon’s formidable balance sheet should ward off any prospects of another white-knuckle ride as and when things change.
Its strong balance sheet also lends credibility to the recently-improved dividend plans. With the yield at around eight per cent, the income prospects are a clear attraction to investors.”