Persimmon Plc (PSN.L) stock analysis

In our weekly check, Persimmon Plc is graded D (A to F). Of 25 checks on debt, profit, cash flow and trend: 12 pass, warnings: 5, red flags: 8.

About Persimmon Plc

Persimmon Plc is a Consumer Cyclical company (Residential Construction) based in the United Kingdom, listed on LSE as PSN.L.

What our checks show for PSN.L

Red flags

• The net margin fell by 14.2 points over 5 years, to 7.6%: the company keeps less of each sale as profit.
• The gross margin fell by 13.6 points, to 16.4%: costs are rising faster than prices.
• Operating cash flow is only 0.1x net profit: part of the reported profit does not arrive as cash.
• Revenue fell 0.6% a year over the last 3 years.
• Free cash flow is negative (-0.3% of revenue): the business spends more cash than it brings in.
• The stock has fallen as much as 88% from a peak. Would you have held through that?
• Recovering from its deepest fall took about 5.8 years.
• Pay in shares equals 0% of free cash flow: it dilutes shareholders.

Warning signs

• Earnings per share fell 20.3% a year over the last 3 years.
• Net profit fell 20.1% a year over the last 3 years.
• The net margin is only 7.6%: little room if costs rise.
• The price swings a lot: 37.1% annual volatility. Expect large ups and downs.
• Beta 1.33: the stock usually moves more than the market, both up and down.

Strengths

• Debt is low: 0.08x equity.
• Operating profit covers interest 17.8 times over.
• The price is 13.1 times earnings (P/E), reasonable for its growth.
• Actively traded: about 2.1 million shares a day.

Similar companies

MTH · BTRW.L · SKY · CVCO · MHO · BKG.L

Questions

What grade does Persimmon Plc (PSN.L) have?

In our weekly check, Persimmon Plc is graded D (A to F). Of 25 checks on debt, profit, cash flow and trend: 12 pass, warnings: 5, red flags: 8. The grade is a risk check, not a buy or sell recommendation.

What are the main risks of PSN.L stock?

This week's biggest flags for Persimmon Plc: Margins falling, Gross margin falling, Profits not backed by cash. In total 13 of 25 checks show a warning or a red flag.

What does Persimmon Plc do?

Persimmon Plc is a Consumer Cyclical company (Residential Construction) based in the United Kingdom, listed on LSE as PSN.L.

The grade is a risk check, not a price forecast, and not investment advice. In our 10-year test (S&P 500, 2016-2026), stocks we graded A or B fell more than 30% 2-3 times less often than D or F, without a lower average return.

Updated 2026-10-31

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