UPDATE: Piper Jaffray Downgrades Cache to Neutral Post FQ2 Report

Piper Jaffray reduced its rating on Cache

from Overweight to Neutral and lowered its price target from $8 to $4. Piper Jaffray noted, "Gross margin was below our expectation in FQ2, and management guided to a wider-than-expected loss in FQ3 given the need to clear seasonal product that didn't sell through in May and June. While management has identified further expense reduction opportunities, fashion-related markdowns and inventory growth to support e-commerce will likely prevent CACH from generating positive free cash flow in the back half of the year or in FY13." Cache closed at $3.20 on Tuesday.