UPDATE: Bank of America Downgrades Target as Sales and LT Margin Outlook is Deteriorating

In a report published Thursday, Bank of America analyst Robert F. Ohmes downgraded the rating on

from Neutral to Underperform, and lowered the price target from $70.00 to $60.00. In the report, Bank of America noted, “We rate TGT shares Underperform as we believe 1) Target's core comps (excluding traffic driving initiatives such as P-Fresh & 5%-off Red Card Rewards) could continue to remain weak, 2) continued challenges with the U.S. profit model as RED Card and P-Fresh initiatives put pressure on gross margin and store level SG&A. Additionally, the profit ramp-up in Canada could continue to be slower than anticipated.” Target closed on Wednesday at $63.31.