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Brokers: Persimmon’s first half ahead of expectations

Persimmon and Jersey Oil & Gas drew focus, but, otherwise it was a typically August morning in the City.

house building site
Liberum noted Persimon's positive outlook for the second half

UK housebuilder Persimmon Plc (LON:PSN) managed a better than expected first half despite the Brexit uncertainty, highlights stockbroker Liberum Capital.

Although Liberum is sticking with a ‘hold’ rating, the broker reckons market consensus will increase of the back of today’s interim results.

Persimmon reported a 29% increase in pre-tax profit which totalled £352mln, following a 12% rise in sales and better margins.

Liberum also noted management’s positive outlook for the second half, with the builder confident of seeing a ‘good’ autumn sales season.

George Salmon, analyst at Hargreaves Lansdown, meanwhile, commented: ““With analysts already confident that Persimmon would report strong numbers for the first half, all eyes were on what the group would say about trading since the EU referendum.

“With cancellation rates actually declining, and sales rates and visitor numbers up strongly, Persimmon at least look to remain in rude health at present.”

Elsewhere on a typically August morning there wasn’t a huge amount to report, with upgrades and downgrades thin on the ground.

Deutsche Bank repeated a ‘sell’ recommendation for recruiter Hays plc (LON:HAS) whilst moving higher on its target, to 105p from 100p.

Insurer Hastings Group Holdings Ltd (LON:HSTG) had a ‘buy’ recommendation repeated by Peel Hunt and the target rose to 240p from 210p.

At the same time Barclay’s target for larger rival Aviva Plc (LON:AV.) was shaved to 421p from 422p.

Barclays also moved to a lower target for Tullow Oil (LON:TLW), 310p from 320p, but it also stuck with an ‘overweight’ rating for the oiler.

Deutsche Bank still sees block and stone maker Forterra Plc (LON:FORT) as a ‘buy’ although its target lowers to 204p from 213p.

In the small cap market Jersey Oil & Gas Ltd (LON:JOG) was in the spotlight – and the share rose over 18% - after it unveiled a new exploration partnership with Statoil in the North Sea.

“Given Jersey has a market capitalisation of just £2.5m this news will likely have a very material impact on the share price,” said Werner Riding, analyst at Peel Hunt.

“The introduction of a high-quality fully-integrated operator such as Statoil into the JV represents a highly positive outcome for Jersey shareholders.”

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