Wolseley (ISE: WOS.L) fell 92 pence, or 4%, to 2,236 pence this morning after warning that it may have to write down the carrying value of certain European operations.
The FTSE 100 company, which is the world's largest specialist trade distributor of plumbing and heating products, confirmed that it is to explore "strategic options" for its operations in France. At the 2011 year-end, the division employed net assets of 500 million pounds, of which 136 million pounds was goodwill.
Wolseley also admitted the "difficult market conditions" it had experienced throughout Europe had continued. In particular, trading conditions in Denmark were said to remain "challenging" and have prompted a review of a further 393 million pounds of goodwill.
As this morning's news and share-price reaction shows, Wolseley's exposure to cyclical markets can sometimes bring nasty surprises to unfortunate shareholders.
If you are seeking more reliable FTSE 100 shares, however, The Motley Fool has produced a special free report that could assist your investment decisions.
"8 Dividend Plays Held By Britain's Super Investor" reveals the favorite blue-chip stocks held by Neil Woodford -- the City fund manager who has thrashed the FTSE 100 during the five, ten, and fifteen years to 2011. Unlike Wolseley, many of Woodford's current selections have been hitting fresh 52-week highs of late.
The Fool's exclusive Neil Woodford report can be downloaded immediately. But hurry, the report is free for a limited time only.
Investing is by no means easy in today's uncertain economy. That's why we've published "Top Sectors Of 2012" -- our guide to three favorable industries. This free report will be dispatched immediately to your inbox.
Further Motley Fool investment opportunities
At the time thisarticle was published Maynard does not own any share mentioned in this article.The Motley Fool has a disclosure policy.
We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.