logo-loader
viewKingfisher plc

Kingfisher weak as RBC cuts rating to ‘underperform’, expects earnings downgrade cycle to continue

The Canadian bank’s analysts reduced their pre-tax profit and earnings per share forecasts for the owner of B&Q and Screwfix stores by around 4%-6% for full-year 2019/20

Castorama store
In early morning trading, Kingfisher shares were 4.5% lower at 216.60p

Kingfisher PLC (LON:KGF) took a tumble on Monday as RBC Capital downgraded its rating for the home improvement retailer to ‘underperform’ from ‘sector perform’, saying it expects the earnings downgrade cycle to continue

The rating downgrade came as the Canadian bank’s analysts reduced their pre-tax profit and earnings per share forecasts for the owner of B&Q and Screwfix stores by around 4%-6% for full-year 2019/20 due to lower like-for-like sales assumptions.

READ: B&Q owner Kingfisher to exit Russia, Spain and Portugal as third-quarter sales fall

In a note the clients, the analysts pointed out that the FTSE 100-listed firm’s major brand Castorama is underperforming the French DIY sector as it has a weak digital offering, and its new unified offering has not resonated with customers. They noted that Castorama's like-for-like sales growth in Poland has recently faded as well.

The analysts also highlighted the impact of a challenging outlook for French and UK housing markets, saying that, as a result, it will take time for customers to respond to Kingfisher's marketing initiatives.

In early morning trading, Kingfisher shares were 4.5% lower at 216.60p, with RBC also cutting its target price for the stock to 200p from 240p..

Quick facts: Kingfisher plc

Price: 220.6 GBX

LSE:KGF
Market: LSE
Market Cap: £4.65 billion
Follow

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

Ariana Resources' Kerim Sener talks 'continued positive performance' at...

Ariana Resources PLC's (LON:AAU) Kerim Sener says the firm's enjoyed one its strongest quarters ever for revenues generated. He says production from the Kiziltepe mine in Turkey was just shy of 7,000oz and combined with a very strong gold price boosted sales. Sener also updates on...

34 minutes ago

RNS

Director/PDMR Shareholding

19 hours, 59 minutes ago

Director Declaration

2 days, 1 hour ago

Director/PDMR Shareholding

6 days, 22 hours ago

Directorate Change

2 weeks ago

Holding(s) in Company

2 weeks, 5 days ago

Director/PDMR Shareholding

3 weeks, 1 day ago

Total Voting Rights

3 weeks, 1 day ago

EMTN Programme

on 18/9/19

2 min read