Kingfisher PLC (LSE:KGF) (Kingfisher PLC (LSE:KGF)) bucked the weaker market trend today as Deutsche Bank reiterated its 'buy' rating on the stock despite lowering its price target to 275p from 280p.
Shares in the FTSE 100 listed retailer, which owns B&Q and Screwfix, rose 1.35% to 249.70p.
“Sales trends have held up better than expected for Kingfisher both in the UK and France especially given the reversal of COVID trends” according to Deutsche Bank analysts.
They accepted that the pressure on disposable income from inflation and the slowdown in housing transactions is still likely to weigh on the sales outlook for the fourth quarter and the fiscal year 2024.
But although the consensus view is that Kingfisher profitability will not be able to stand up against this tide the analysts believe “that the current valuation already reflects the risk of a sales slowdown and management is focussing on cost control whilst investing for future growth.”
They forecast that the home improvement market will prove to be more resilient than investors expect and also pointed out that Kingfisher has the benefit of geographic diversity and a strong balance sheet.