Kingfisher shares tumbled earlier this week after a major broker downgraded the company and suggested that investors sell their stock. The B&Q owners shares dropped by 11.5p to just 243p and was part of a general downturn in the retail market. This represented a 4% fall. Other retail stores to see sharp declines were Primark, Marks & Spencer, Next and Dixons.
It is thought that the broker SG made the recommendation due to the link which the DIY market has with the housing market.
It pointed out that sales at the store have been in decline since 2005 and that it is predicted that sales will fall by a further 15% in the next two years. Falling activity and housing prices in the building sector are adding to the pessimistic outlook.
The broker has also suggested that it may be time to worry about the future of B&Q in the UK market. The retail store still does well in other parts of Europe and is expanding into markets such as China.
The news comes as the B&Q chief executive Euan Sutherland announced an upgrade to the company's website to improve the customer experience. The company will be spending £35m over the next three years to add a site which is suitable for use from a mobile phone, and iPhone app and a doubling of the number of products sold via the website. It is promised that the new website will be more joined up and easier to use.
It is thought that this move is part of a sales drive to improve the fortunes of the company.