FTSE 250 stocks are under pressure for a third day as the Middle East conflict escalates. Some shares are faring far worse than others, however. Take Vistry Group (LSE:VTY), which was last trading 18% lower at 517p per share.

Investors have been spooked by the housebuilder’s full-year trading report. Yet results were in line with guidance, and trading picked up during the second half of 2025. At face value, Vistry’s share price plunge might appear excessive.

So what’s caused the builder to collapse today? And could this represent an attractive dip-buying opportunity?

A stronger animal

Vistry is one the UK’s top housebuilders by volume, and a specialist in the affordable housing segment. It’s toiled in recent times as higher interest rates have crimped buyer affordability, and by extension sales of new-build properties have been hit, even at lower price points.

In 2025, the firm’s adjusted revenues dropped 4% to £4.2bn, as completions slumped 9% to 15,658. Yet Vistry was still able to grow adjusted profit before tax 2% from the previous year, to £268.8m. This was thanks to a rising margin, reflecting fewer contributions from lower-margin southern sites, combined with the firm’s strong negotiating power with suppliers.

Encouragingly, the FTSE 250 company said it’s kicked off 2026 strongly, with its year-to-date weekly sales rate per site at 1.42, up from 0.59 from the same period last year.

Vistry’s clearly a much more resilient beast than in 2024 when it released a string of profit warnings. So why is its share price plummeting?

Digging deeper

The problem is that while sales are up markedly in 2026, the builder’s having to cut prices to get the top line growing again. It means that Vistry’s expecting profits to remain unchanged from last year’s levels as buyer incentives hit margins.

Furthermore, while profits picked up last year, the company’s balance sheet remains pretty weak. Net debt dropped 20% in 2025, but remained elevated at £144.2m as of December. With profits tipped to flatline in 2026, any hopes investors had of dividends returning have been kicked into the long grass.

Finally, it was announced today that chief executive Greg Fitzgerald will step down within the next year. The departure of the 45-year-industry veteran adds more uncertainty during a tough time for the sector.

Are Vistry shares a possible buy?

Today’s plunge means Vistry’s share price trades on a forward price-to-earnings (P/E) ratio of just 7.8 times. That’s significantly below the 10-year average of 14-15.

Like all housebuilders, it faces significant challenges as the UK economy struggles and unemployment rises. But with interest rates tipped to keep falling and the mortgage market heating up, its sales should also receive strong support. Its focus on affordable housing also means sales could hold up well even if economic conditions stay tough.

Looking further out, I think the firm’s profits could rise strongly from today’s levels, as Britain’s booming population drives demand for new homes. So are Vistry shares a buy right now? While not without risk, I think they’re worth serious attention from investors seeking cheap recovery shares.