By Dominique Vidalon
PARIS (Reuters) - Shares in Carrefour fell sharply on Thursday after Europe's largest retailer disappointed investors with dismal 2017 earnings, a dividend cut and a cautious outlook for 2018.
Carrefour shares were down 6.3 percent by mid-session trading, with the stock among the worst performers on the pan-European STOXX 600 index.
Last month, Carrefour a new strategy to boost profit and revenue in the face of the growing threat from the likes of Amazon, but its cautious guidance for this year acted as a wake-up call that the road to recovery would be long.
Several brokers revised down their estimates.
"The strategic plan announced by the new management is sensible and ambitious. However, most of these strategic initiatives will start to have an impact on Carrefour's performance from 2019 only, while the group will continue to evolve in a tough environment in most countries," said Barclays analysts.
The Barclays team kept an "equal-weight" rating on Carrefour but cut their earnings per share (EPS) estimates by 1 percent.
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Carrefour, the world's second-largest retailer behind Wal-Mart, said late on Wednesday that it expected currency exchange rates, along with restructuring and one-off charges, to weigh on profits this year.
It also posted lower operating profit for a second year running, due to a sharp fall in profits in its core French market, and a hefty 531 million euros net loss.
Analysts at brokerage Oddo expected a 5-8 percent cut in consensus expectations for Carrefour's 2018 EBIT (earnings before interest and tax) as a result.
Oddo itself eyed a 2018 EBIT of 1.890 billion euros while Barclays forecast 2 billion euros, broadly unchanged from 2017.
Analysts also said there were not many clear signs of recovery at Carrefour, where the company not only faces challenges from Amazon but also from privately-held supermarket operator Leclerc as well as other online retailers.
"From the call it seemed that solid signs of volume recovery in France might take longer to come through," wrote analysts at brokerage Bernstein, which kept a "market perform" rating on Carrefour.
Carrefour shares, which fell around 20 percent last year, are down around 1 percent so far in 2018.
($1 = 0.8199 euros)
(Editing by Leigh Thomas/Sudip Kar-Gupta)