Stockbroker tips from ShareCast

Broker snap: Persimmon's margins on the mend

The wheels have come off the Persimmon revival bandwagon this year with the stock coming down from its January peak of around 500p to dip below 400p at one point but they are back on the rise after Tuesday's results, with good cause, in Panmure Gordon's view.

The broker has upgraded its price target for the housebuilder to 555p from 549p and retained its 'buy' recommendation after Persimmon announced 2009 figures that were ahead of Panmure's expectations.

'A continued focus on operating margins at the business, has significantly improved profitability and this should continue. Whilst concerns remain over the fragility of the UK mortgage market and ongoing economic conditions, these are reflected in our assumptions,' Panmure Gordon said, adding that it would revise its projections after the company's analysts' meeting.

The Panmure team's early thoughts are that its £13m profit before tax forecast for 2010 will be bumped up, possibly as high as £75m.

'Persimmon has £900m of forward sales in the hopper, which has improved from the £640m achieved at the start of January. Within that, the group comments that pricing has held firm and the group continue to concentrate on improving margins,' the broker said.

Stockbroker tips: Most read

Broker tips: BT, Misys, GAME
Fri 03 February 2012 11:27
Broker tips: ARM, Whitbread, Premier Oil
Mon 30 January 2012 11:25
Broker tips: Glencore, Shell, 888
Mon 06 February 2012 12:44
Broker tips: N. Brown, Aveva, Max Petroleum
Fri 27 January 2012 11:31
Broker tips: ARM, Afren, Heritage Oil...
Tue 31 January 2012 11:52

Deal shares from just
£5.95 per deal
Find out more »

No news or research item is a personal recommendation to deal. Hargreaves Lansdown may not share ShareCast's (powered by Digital Look) views.

Market latest

FTSE 100 | FTSE 250 | All Share

FTSE 100	5,895.47	+0.33%
FTSE 250	11,234.57	+0.65%
FTSE All Share	3,046.11	+0.39%
Dow Jones	12,890.46	+0.05%
NASDAQ	2,927.23	+0.39%
Xetra DAX	6,788.80	+0.59%
Paris CAC 40	3,424.71	+0.43%
Nikkei 225	8,981.88	-0.23%
Hang Seng	20,888.68	-0.58%