Gap shares Wednesday fell as much as 3.8% after the apparel and accessories retailer was initiated underweight at Barclays with a $14 price target.

At last check the San Francisco retailer's shares were trading off 2.9% at $16.67. They've traded as low as $16.51 during the session. They are about half their 52-week high above $31, set back in March.

"We initiate coverage of GPS at underweight given negative [comparable-sales] trends at the three core brands; excess inventory both currently and in the pipeline that ... will result in ongoing pressure to merchandise margins; and lack of brand resonance with the key Millennial and Generation Z demographics at the Gap and Banana Republic brands," Barclays analyst Adrienne Yi wrote.

"[Fundamentals] are deteriorating as competition in all categories remains stiff and pricing power is fleeting in all of [Gap's] core markets," the note says.

Yi is skeptical about Gap's plan to spin off Old Navy, which it announced in March and hopes to complete early next year.

"Given the recent turn to negative [comparable sales] at Old Navy and what we deem will be a fiercely competitive backdrop for [the holidays] and into fiscal 2020," the spinoff potentially could "[mask] underlying weakening fundamentals," she wrote.

What could change Yi's opinion? One factor would be a resolution of the U.S.-China tariff dispute. Gap sources some 18% of its products from China, the analyst said.

Another possibility would be negative comparable-sales trends improving or turning positive at one or more of Gap's three core brands, "particularly Old Navy."

And a third would be reset expectations for each of the newly formed businesses once the spinoff is complete, she said.

Gap last week said Art Peck would step down as president, CEO and a director. Chairman Robert Fisher added the top two executive posts on an interim basis.

Comparable sales, Gap said in a statement, were down 4% companywide, reflecting drops of 7% at Gap, 3% at Banana Republic and 4% at Old Navy. And it cut its earnings estimates for fiscal 2019.