×

STOCKS NEWS EUROPE-Kingfisher falls after MS cuts rating

Shares in Kingfisher fall 0.5 percent in early deals, among the main fallers on a rising FTSE 100 , with traders citing a downgrade by Morgan Stanley to "equalweight" from "overweight" weighing on sentiment on Europe's largest home improvements retailer.

The bank also cuts its target price on Kingfisher 290 pence from 325 pence saying worries about worsening trading conditions in France are weighing heavily on Kingfisher's shares.

"We don't see the shares re-rating upwards whilst investors remain so concerned about France, but think the solid structural story, strong management and healthy balance sheet preclude much of a de-rating ... We expect the shares to remain range-bound for several months," the bank says.

Kingfisher's revenue growth is 3.7 percent below its five-year historical average, although that figure is better than peer Home Retail , while revenues are 4.5 percent below its five-year historical average, according to Thomson Reuters Starmine Data.

Kingfisher's forward 12-month earnings have been cut by 4.2 percent over the last 30 days based on top-rated analysts in the sector, while forecasters predict a 1.8 percent contraction in earnings over the next 12-months, according to Starmine.

Reuters messaging rm://david.brett.thomsonreuters.com@reuters.net

Keywords: MARKETS EUROPE STOCKSNEWS