Deutsche Bank downgrades AB Foods, Kingfisher and Wickes
By Michele Maatouk
Date: Tuesday 26 Aug 2025
(Sharecast News) - Deutsche Bank downgraded its stance on Associated British Foods, Kingfisher and Wickes on Tuesday as it took a look at the UK retail sector.
"We are taking a more cautious view on the UK consumer," the bank said.
"The end of 2024 and early 2025 are likely to have been the sweet spot with real wage growth set to slow and fear of unemployment set to build from here. Our Household Cash Flow model shows discretionary spending lagging spending power and, unless consumers reduce savings, there will be a 4ppt slowdown in discretionary spend to +3% in 2H from +7% in 1H.
"Retail sales have been resilient into Q2 helped by warm weather although there is some variance by category."
DB said consumer confidence metrics remain subdued and its new "Fear Index" suggests things may be getting worse.
The bank cut Primark owner AB Foods and Wickes to 'sell' from 'hold', while Kingfisher was downgraded to 'hold' from 'buy'.
DB cut its price target on AB Foods to 2,130p from 2,220p, on Wickes to 195p from 205p and on Kingfisher to 280p from 320p.
Deutsche kept its rating on Dunelm at 'buy' and lifted the price target to 1,360p from 1,320p. Next was maintained at 'hold' but the price target upped to 11,600p from 10,800p, while Marks & Spencer was left at 'buy' and the price target cut to 435p from 450p.
Victorian Plumbing was kept at 'hold' and the price target nudged up to 70p from 95p.
At 0935 BST, AB Foods shares were down 4.1% at 2,220p, Kingfisher was 4.2% lower at 269.40p and Wickes was 8.5% weaker at 201.72p.
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