Retailer Francesca's Holdings Corporation Falls After Downgrade By Canaccord

Francesca's Holdings Corporation FRAN was downgraded Thursday by Canaccord Genuity Inc.  The Price Target was lowered from $17 to $14.

Analysts Laura Champine and Jason Smith found it “difficult to envision Francesca’s regaining momentum amid the current challenging retail climate given the sales volatility and operating margin contraction that has developed under current management.”

The report critically noted that the “company’s primary competitive advantages have eroded in our view as a result of merchandising mistakes made over the last year.”

The analysts forecasted that EBIT margin will contract by 200 basis points in FY 2015 after a decline of 640 basis points this year.

They concluded by recommending it “prudent to step to the sidelines amid the ongoing margin deterioration.”

Francesca's Holdings Corporation traded at $13.61 late Thursday, down 1.87 percent.