UPDATE: Piper Jaffray Downgrades PetSmart to Neutral;l Growth Set to Decelerate

Piper Jaffray downgraded PetSmart

from Overweight to Neutral and lowered the price target from $82.00 to $68.00. Piper Jaffray said, "We are downgrading PETM shares to Neutral and reducing our price target from $82 to $68 following somewhat disappointing Q4 results. We continue to like the industry backdrop (with strong growth and fragmented competition), PETM's solid execution and differentiation, and its positioning in the secular pet food trade-up theme. However, Q4 appears to be an inflection point for decelerating growth in the coming year(s), after 3 years of spectacular growth. Sales driving initiatives for 2013 appear less exciting compared to recent years, and the gross margin drivers around price optimization and localized assortment are not kicking in as quickly as we thought." PetSmart closed at $66.55 on Wednesday.