October might be a great time to consider buying this hot UK stock


A picture of a house decorated on the day of Halloween.

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Some UK stocks have enjoyed a very good last trading week of September. One example would be FTSE 100 member Persimmon (LSE: PSN). A rise of almost 14% smashes the return of the index, which is actually down slightly on where it stood five days ago.

With the shares going ex-dividend in October and a trading update due in November, does it make sense to consider buying a slice as soon as possible?

Should you buy Persimmon Plc shares today?

Before you decide, please take a moment to review this report first. Despite ongoing uncertainties from US tariffs to global conflicts, Mark Rogers and his team believe many UK shares still trade at substantial discounts, offering savvy investors plenty of potential opportunities to learn about.

That’s why this could be an ideal time to secure this valuable research – Mark’s analysts have scoured the markets to reveal 5 of his favourite long-term ‘Buys’. Please, don’t make any big decisions before seeing them.

Here’s my take.

What’s behind the jump in this UK stock?

To be clear, Persimmon isn’t the only housebuilder whose share price has charged upwards lately. Most listed stocks in this sector have experienced some positive momentum.

The reason for this is the recent announcement from PM Andy Burnham. Last Saturday, he introduced a new scheme to help first-time buyers. Fittingly, this is to be called Your First Home. The idea is that those wanting to get on the property ladder would need only a 2.5% deposit to do so, and be supported by a government-backed equity loan for up to 20% of the value of the property.

More concrete details are expected in the Autumn Budget on 29 October. But given that Persimmon targets the younger demographic with more affordable homes, it’s no surprise that investors piled in early.

Already priced in?

The fact that the market has reacted (very) positively to the announcement is an encouraging sign. But there lies the rub.

After rocketing upwards, we could argue that the development is now priced in. This could lead to some profit taking during October. There’s also a chance that some of the aforementioned gain could be given up as the market digests the fine print of the new scheme.

A trading update is scheduled for 12 November too. Will investor expectations have gone even higher by the time it lands? If so, the outlook statement will need to be chock full of positive vibes to satisfy them.

Don’t forget the dividends

Still, I could argue that there are other attractions to this UK stock. The dividend yield stands at 4.6%. That’s based on analyst projections of a 60.8p per share total payout.

That yield is more than investors would get from simply tracking the FTSE 100 index. A proportion of this distribution — 20p per share — will also go to those who hold the stock before the ex-dividend date of 15 October.

Just what the doctor ordered

Personally, I think the Your First Home scheme is the shot in the arm that the housing market — and housebuilders — desperately need. For years, the sector has been held back by higher costs, rising interest rates and the 2023 removal of Help to Buy.

However, I also reckon that anyone pondering a purchase of Persimmon stock in October should think carefully about how long they’re prepared to hold for. There’s no doubt that we need more quality housing to meet demand going forward. But with inflation on the rise again, the idea that buying today will secure a tidy profit in a short period of time might be fanciful.

This company is now back on my radar. But it’s certainly not the only UK stock I’m running the rule over.

Should you invest £5,000 in Persimmon Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Persimmon Plc made the list?


Paul Summers has no position in any of the shares mentioned.



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