NEW YORK (TheStreet) -- Shares of Fitbit (FIT) - Get Report were slumping in pre-market trading on Thursday as Pacific Crest reduced its stock rating to "underweight" from "sector weight" this morning.
The firm said channel checks indicate that the San Francisco-based health and fitness device company's Charge 2 sales are "off to a slow start."
Initial sales also appear to be below its Blaze and Alta product levels, both of which were released earlier this year.
"We continue to believe that a large portion of Fitbit owners stop using the device within months, which is a fundamental issue driving high churn that will make growth more challenging," Pacific Crest said in an analyst note.
Charge 2 sales are likely to ramp up as the holiday season approaches, the firm added.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
TheStreet Ratings team rates Fitbit as a Hold with a ratings score of C-. The primary factors that have impacted the rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. However, as a counter to these strengths, the team also finds weaknesses including a generally disappointing performance in the stock itself and unimpressive growth in net income.
You can view the full analysis from the report here: FIT