Persimmon Shares Slide as Housebuilder Cautions on Market Headwinds and Budget Uncertainty

Persimmon (LON: PSN) shares fell over 2% to 1,110p in early Wednesday trading after the UK housebuilder flagged ongoing “challenging market conditions” and uncertainty ahead of the upcoming Budget, despite posting higher first-half profits and sales. 

The stock is down more than 7% so far this year and over 29% in the past 12 months.

For the six months to 30 June 2025, new home completions rose 4% year-on-year to 4,605, while the average sales price increased 8% to £284,047. 

New housing revenue climbed 12% to £1.31 billion, lifting underlying operating profit 13% to £172 million, with margins steady at 13.1%.

The FTSE 100 builder’s current private forward order book is up 11% to £1.25 billion, with the total order book, including partnerships, 9% higher at £1.86 billion. The company's cash, as of June 30, came in at £123 million, down from £350.2 million reported in the same period last year.

The company reaffirmed its full-year guidance for completions of between 11,000 and 11,500 homes and a housing operating margin of 14.2% to 14.5%.

Chief executive Dean Finch said the company had grown completions, prices, and planning approvals “despite challenging market conditions and with affordability still an important constraint”, crediting operational discipline and investment in land and outlets.

Looking ahead, Persimmon expects volumes to rise to around 12,000 units in 2026, although margin growth could be tempered by affordability pressures, increased industry costs, and easing build-cost inflation.

“Overall, while we are mindful of geopolitical events and challenging market conditions, including uncertainty in advance of the Budget,” the company stated.

Analyst Summary: Bull and Bear Cases