Persimmon Shares Extend Rise as Deutsche Bank Upgrades to Buy

Deutsche Bank upgraded Persimmon (LON: PSN) to Buy from Hold on Friday, reversing a downgrade the bank made in January and adding to a wave of bullish sentiment following the housebuilder’s half-year results.

Persimmon shares closed at 1,166.5p on Friday, having climbed steadily since early August. The stock jumped roughly 3-3.6% on Thursday to around 1,163p after the York-based builder published first-half results showing completions up 13% to 5,189 homes and underlying operating profit rising 10%, comfortably beating market expectations.

Management also lifted its full-year outlook, guiding towards the upper end of its 12,000-12,500 completions target despite what it described as a “challenging” market backdrop.

The upgrade caps a strong run for the stock, which has advanced from around 1,053p at the start of June to above 1,160p now — a gain of more than 10% over roughly two months, even as shares remain well below their 52-week high amid lingering concerns over UK mortgage rates and housing affordability.

Deutsche Bank’s move follows a period of caution from analysts: HSBC downgraded Persimmon to Hold earlier this year citing risks of a “double dip” in housing demand, while Morgan Stanley trimmed its price target. Deutsche Bank itself cut Persimmon to Hold in January, warning valuation had run ahead of fundamentals.

Friday’s reversal suggests analysts now see the combination of upgraded guidance, resilient margins from Persimmon’s vertically integrated building materials operations, and a debt-free balance sheet as sufficient to justify renewed conviction, even with broader rate uncertainty still weighing on the wider housebuilding sector.