FTSE 100
FTSE 100

Kingfisher Share Price Finds No Love After Dividend Boost

The Kingfisher share price is not seeing any love even after the company boosted its dividend and buybacks. The KGF share price is trading at 348p, which is about 7% below the highest point on Tuesday. It is still more than 32% above where it started the week at.

Kingfisher news

Kingfisher is a leading DIY retailer that operates in the UK, France, Spain, and other European countries. Like Home Depot and Lowe’s in the US, the company benefited substantially from the pandemic. This happened as many people stayed at home and invested in their home offices and outdoors. 

However, recently, Kingfisher has faced some challenges. There is an ongoing worker shortage and the cost of importing goods has ballooned. The company is also facing the relatively new challenge of supply shortage and Brexit issues. 

Kingfisher reported strong results on Tuesday. The firm said that its sales in the third quarter have declined by 0.6% from the same period in 2020. But they are up by about 16% from its pre-pandemic levels. The firm also raised its forward guidance, saying that it expects its sales will drop by no more than 7%.

Its pre-tax profit increased by 70% to 677 million pounds in the first half of the year while its e-commerce sales jumped by 21%. As a result. It boosted its dividend from 2.75p to 3.80p.

Therefore, the Kingfisher share price has declined because the forward guidance was relatively modest than was expected. Also, investors expect the company to face significant challenges to match its recent growth going forward.

Kingfisher share price forecast

The daily chart shows that the Kingfisher share price has been in a tight range recently. It has dropped by more than 8% from its highest level this year. At the same time, it has declined below the 25-day and 50-day EMA. The shares have also formed a horizontal channel shown in blue and a triple-top pattern.

Therefore, there is a possibility that the KGF share price will remain in a bearish trend as bears target the lower side of the triple-top pattern at 335p. On the flip side, a move above 360p will invalidate the bearish view.

kingfisher share price