OKLAHOMA CITY -- Now, even some loyal

Force Protection

(FRPT) - Get Report

supporters are succumbing to battle fatigue.

Take Thomas Weisel Partners analyst David Gremmels, for example. After initiating coverage of Force Protection with an overweight rating this spring -- and then watching the company steadily lose ground since that time -- Gremmels finally downgraded the stock to market-weight from overweight on Monday.

Rather than sure-fire victory, Gremmels now sees possible landmines ahead.

For starters, he worries that strong demand for Force Protection's all-new Cheetah -- once viewed as a likely replacement for the Humvee -- will fail to materialize. Moreover, he fears that Cheetah-related investments could cause a significant hit to Force Protection's earnings.

Even without major orders for the Cheetahs, Gremmels predicts Force Protection will soon tap the capital markets -- seeking between $100 million and $200 million in funding -- to finance production of the vehicles. Therefore, Gremmels sees clear risks ahead.

"We are increasingly concerned by the aggressive plan, and note that this strategy is unusual in the defense industry," Gremmels wrote when downgrading the company on Monday. Ultimately, "our Cheetah outlook is less optimistic than consensus" estimates.

Moreover, Gremmels fears that those estimates already include another big contract for Force Protection's popular mine-resistant ambush-protected vehicles.

Specifically, Gremmels expects the U.S. to place new orders for 6,500 MRAP vehicles in the coming weeks. He foresees Force Protection supplying roughly one-third of those. But he doubts that the company's stock will bounce as a result.

"Force Protection has received 47% of Category 2 orders to date -- but won only 33% of the 758 Category 2 vehicles ordered on Oct. 18," Gremmels stressed on Monday. "In the past, the stock has reacted positively to news flow.

"But given the publicity surrounding this order, we no longer expect it to serve as a catalyst."

Meanwhile, Gremmels has trimmed his own outlook for Force Protection's stock, putting his price target at $17, down from $22 earlier. His firm makes a market in the company's securities.

Force Protection's stock was down 3.8% to $14.45 Monday on Gremmel's downgrade. After peaking above $30 in late spring, the shares now trade near their lowest price of the entire year.

Even so, Force Protection still has plenty of fans. Most analysts expect the company's stock to climb back above $25, and possibly hit $35, over the course of the next year.

But Stanford Group analyst Josephine Millward sees more attractive opportunities. Late last week, she highlighted two Force Protection rivals that could land new orders for military vehicles very soon.

BAE Systems

and

Navistar

( NAVZ) make medium mine-protected vehicles, which enjoy longer-term funding support than does the MRAP program, Millward stressed. Moreover, she added, they also rank as top MRAP vehicle suppliers.

"In our view, either BAE Systems or Navistar will be the most likely winner for MMPV due to their leading positions on MRAP I," Millward wrote on Friday. Meanwhile, "Force Protection recently disclosed in its 10-Q filing that its joint-venture proposal with

General Dynamics

(GD) - Get Report

(for MMPV) was disqualified," potentially knocking it out of the new MMPV game.