NEW YORK ( TheStreet) -- Shares of Coldwater Creek ( CWTR) sank to their worst levels in more than 19 months on Thursday, falling nearly 10% on heavy volume, without a clear driver for the move beyond simmering investor frustration.

"No specific news today but the Q3 report and outlook was very weak with no hope for new and improved lines until late March," said Sterne Agee analyst Margaret Whitfield in an email to TheStreet. "No doubt people are throwing in the towel."

The stock fell 29 cents, or 9.5%, to close at $2.77, its first finish below $3 since April 27, 2009. Volume of 5 million was more than six times the issue's trailing three-month daily average of around 885,000, and the heaviest session for the shares since Oct. 19 when the company disappointed Wall Street by forecasting a loss for its fiscal third quarter.

Thursday's session low of $2.73 was the stock's worst intraday level since April 8, 2009. Year-to-date, the shares have fallen more than 31%.

Sandpoint, Idaho-based Coldwater Creek attributed its surprise loss in the third quarter to customer dissatisfaction with its fall merchandise assortment as well as weak economic conditions and it gave investors little hope for the current fourth quarter in the Form 10-Q it filed with the Securities and Exchange Commission on Tuesday.

"We expect the challenges we experienced with our fall assortment to continue during the fourth quarter," the company said.

It continued: "In addition, weakness in consumer spending persists as a result of continued uncertain macroeconomic conditions reflected in reduced incomes, high unemployment and deterioration in household net worth. We believe these conditions continue to have a negative impact on our sales, gross margin and operating performance."

Assuming that's the case, Coldwater Creek's actual quarterly loss could come in beyond the current average estimate of analysts polled by Thomson Reuters is for a loss of 25 cents a share in the fiscal fourth quarter on sales of $282.8 million, a possibility that Sterne Agee's Whitfield referenced in a Dec. 2 research note following the release of the third-quarter report.

"CWTR did not offer specific Q4 guidance but suggested if November trends continued into December that a loss of 25-35c would be reported," wrote Whitfield, who has a neutral rating and 12-month price target of $4 on the stock.

While tax-loss selling might be a factor as well, the realization that the company is facing a slog of at least three months before new merchandise can make a splash may also be setting in, prompting investors to exit positions until there's more of a tangible possibility for a positive catalyst.

The fact that there's no guarantee the company's next collection won't get a similar negative response and questions about whether former fans of the stores will return are also likely to influence market sentiment from here.

While seven of the eight analysts covering the stock, including Whitfield, are at the equivalent of hold ratings, the market action on Thursday indicates plenty of investors don't share that opinion. Book value of $2.49 per share as of the end of the third quarter may provide some support, but with expansion plans scaled back for 2011, the near-term outlook is bleak and creative director Jerome Jessup has his work cut out for him.

Roth Capital echoed this sentiment in its own Dec. 2 note, which brought its 12-month price target on the stock down to $3 from $4.

"While we believe some of the issues are fixable sooner rather than later, i.e. marketing and more opening price points, several large challenges remain, most importantly, the merchandise," the firm said, adding that "there is very little near-term sales and earnings visibility" with improvements not expected until March.

-- Written by Michael Baron in New York.

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