was downgraded by Credit Suisse First Boston after the arts-and-crafts provider cut its full-year earnings forecast amid weaker-than-expected October sales.
CSFB downgraded the company to neutral from outperform and lowered its target price to $36 a share.
Shares of Michaels closed down 24% Thursday on the
New York Stock Exchange
at $33.90, losing $10.78.
The company cut its expected full-year 2003 earnings to $2.05 from $2.10 a share. Analysts expect $2.10 a share. The company expects current third-quarter results to reach the low end of analysts' forecasts of 40 cents to 43 cents a share.
Michaels also lowered its forecasts for same-store sales in the fourth quarter to a 1% increase, down from its original expectations of a 2% to 3% rise.
Chief Executive Michael Rouleau said sales may have been affected by the Maryland-area sniper shootings, some of which took place near Michaels stores. The chain has 36 stores in the area of the attacks. Rouleau also cited lower consumer confidence.
October same-store sales increased 2%, but the Irving, Texas-based company had expected same-store sales to increase 4% to 6%. Analysts were expecting same-store sales to increase 4.3%. Total sales increased 6% to $234.5 million.