Citi cut the teen retailer's rating to sell from hold, saying it will continue to experience deteriorating same-store sales.
Shares of the company tumbled 6% in morning trading to $29.06.
In August, Abercrombie's comparable sales plunged 29%, drastically missing the 23.9% tumble expected by analysts.In comparison, rivals Aeropostale (ARO) beat Wall Street's forecast, rising 9% during the month, while American Eagle Outfitters (AEO) fell 7%, although it still managed to surpass the 9.4% expected.
Abercrombie's problems are bigger than pricing and new merchandise, analyst Kimberly Greenberger wrote in a research note. The company's "proactive promotional stance during back-to-school shopping season is not supporting improved sales productivity," she wrote. Greenberger believes Abercrombie's sales misses will force the company to continue to lower its earnings-per-share forecasts. -- Reported by Jeanine Poggi in New York. Follow TheStreet.com on Twitter and become a fan on Facebook.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV