UPDATE: Ascendiant Capital Downgrades LeapFrog Enterprises on on Lower Consumer Demand for LeapPad 2 Power/Ultra

In a report published Thursday, Ascendiant Capital Markets analyst Edward Woo downgraded the rating on

from Buy to Neutral, and lowered the price target from $12.00 to $8.00. In the report, Ascendiant Capital Markets noted, “Based on our proprietary channel checks, we believe that LeapFrog's new LeapPad 2 Power and Ultra are facing lower consumer demand as compared with last year's LeapPad 2. Despite management's prior comments (in early August) that early sales of its new products (LeapReader, Ultra, Power) are positive and ahead of its expectations with sellouts, we note that LeapFrog's products have consistently been available at Amazon.com [AMZN - Not Rated], Wal-Mart [WMT - Not Rated], Target [TGT - Not Rated], and Toysrus (which is in sharp contrasts with the steady sellouts of the LeapPad 2 last year).” LeapFrog Enterprises closed on Wednesday at $9.15.